Millions would be exempted from income tax as a great Christmas gift to Filipinos

It is indeed a great news and the biggest Christmas gift for all of the employed Filipinos, because a comprehensive tax reform bill that was signed into law that would surely give a positive impact for the Philippines this coming 2018 and would raise billions of pesos to fund government programs.
Thanks to Finance Secretary Carlos Dominguez III and Sen. Juan Edgardo Angara, chairman of the Senate ways and means panel, who framed President Rodrigo Duterte's signing into law of the landmark tax reform measure as ways to boost the living standards of the filipinos and provide them relief.

“This is the biggest Christmas and New Year’s gift that the Duterte administration is giving to the people,” Dominguez said.

"This is to help our countrymen to improve their lives. This is the best Christmas gift that the government could give to each Filipino family." Angara added.

With the newly-signed law, it is indeed a relief from the adjustments to the personal income tax rates in the country, and also the burden of taxation from low-income segments to the richest individuals.

In addition to that, those earning below ₱250,000 annually are also exempted and also for 13th month pay and other bonuses to P90,000.

To cover the lost money from exempting personal income tax, the expansion of the value added tax base and additional taxes on petroleum products, vehicles and sugar-sweetened beverages, among others, are where the government is relying.

“The new law, based on initial computations, could generate almost P150 billion that would be used to fund the government's ambitious infrastructure program and social services. This money, however, was lower than the initial P162 billion that the government of President Rodrigo Duterte sought.” Dominguez said.

The finance secretary said that the passage of the measure showed the "maturity" of the Philippine economy and its readiness to meet the challenges of structural problems and inequities in taxation.

The Philippine’s maturity” and readiness for any challenges like structural problems and taxation inequity were shown by the passsge of the measure according to Dominguez.

“I think it’s a sign of maturity for our country. It is also the first of five packages that will once and for all start fixing the structural problems of the tax system that has become unfair, complex and inefficient. This tax reform will also raise the revenues needed to make real positive change for our people,” Dominguez said.

“This was also the first time that an overhaul of the country's tax system was not brought about by a crisis or external pressure as the law was enacted at a time of strong macroeconomic fundamentals, sound fiscal policy and high gross domestic product rate,” the finance secretary added.

From the whole percentage of the government’s needed incremental revenue, according to Dominguez, the current measure was equivalent to about two-thirds, while the remaining one-third is expected to be passed in 2018 by the Congress that involves the provisions on estate tax amnesty, general tax amnesty, adjustments in the Motor Vehicle Users Charge and amendments to the bank secrecy law and automatic exchange of information.

Dominguez added that the government's infrastructure and modernization program, including additional funding for military and law enforcement capabilities while the rest would go to social services and other anti-poverty measures such as cash transfers to the poor, would benefit the 70 percent of the fund raised.

"We congratulate the Duterte administration and both houses of Congress for the passage of this law that would raise workers' take-home pay and jumpstart infrastructure projects in the country which would help improve the lives of every Filipino," Angara said.

On the other side, some critics claimed that the new tax law would affect those lower-income families because of the expected higher price increase.



No comments

Powered by Blogger.