Home Development Mutual Fund/Pag-IBIG Fund(HDMF)

07 July 2023 Dear MS. TESANY DELCO, This refers to your eFOI request received on 20 June 2023 via the eFOI portal of the Home Development Mutual Fund (Fund) wherein you inquired whether the dividends received from the Fund are taxable. According to you, the purpose of your request is for research. We would like to inform you that Section 19 of Republic Act (R.A.) No. 9679, or the Home Development Mutual Fund Law of 2009, provides that benefit payments made by the Fund are exempt from all kinds of taxes, fees or charges, thus: Section 19. Exemption from Tax, Legal Process and Lien. — All laws to the contrary notwithstanding, the Fund and all its assets and properties, all contributions collected and all accruals thereto and income or investment earnings therefrom, as well as all supplies, equipment, papers or documents shall be exempt from any tax, assessment, fee, charge, or customs or import duty; and all benefit payments made by the Pag-IBIG Fund shall Likewise be exempt from all kinds of taxes, fees or charges, and shall not be liable to attachments, garnishments, levy or seizure by or under any legal or equitable process whatsoever, either before or after receipt by the person or persons entitled thereto, except to pay any debt of the member to the Fund. No tax measure of whatever nature enacted shall apply to the Fund unless it expressly revokes the declared policy of the State in Section 2 hereof granting tax exemption to the Fund. Any tax assessment against the Fund shall be null and void. Furthermore, in Rule IX, Section 4 of the Implementing Rules and Regulations of R.A. 9679 provides for tax free dividend earnings, to wit: Section 4. Dividends, The Board shall set aside annually an amount which in no case shall be less than seventy percent (70%) of the annual net income of the Fund, to be paid in the form of dividends to members. The member’s contributions, inclusive of employee’s and employer’s contributions, shall earn dividends which shall be distributed annually and credited to his or her TAV. Only members with outstanding TAV as of year-end shall be entitled to dividends declared for that particular year. All dividend earnings shall be tax-free. In compliance with Section 6.6.1 of the Anti-Red Tape Authority (ARTA) Memorandum Circular No. 2019-002, series of 2019 entitled Guidelines on the Implementation of the Citizen’s Charter in Compliance with Republic Act 11032, otherwise known as the “Ease of Doing Business and Efficient Government Service Delivery Act of 2018,” and Its Implementing Rules and Regulations, may we kindly request your thoughts or feedback on how we can improve your experience by filling out the Feedback Form in this link: FOI Request Feedback Form (google.com) Thank you. Very truly yours, ATTY. JOSE ROBERTO F. PO Department Manager III, Legal Department and Deputy Compliance Officer