House ratifies bill raising tax exemption cap on bonuses
House of Representatives. INQUIRER.net FILE PHOTO
MANILA, Philippines – The House of Representatives on Monday ratified the bill increasing the ceiling for tax exemption on bonuses for workers in the public and private sector.
This after the chamber adopted the Senate version of the bill setting the cap at P82,000. The House version is at P70,000.
At least 199 lawmakers voted to ratify the bill, with zero against it.
The bill seeks to increase the tax ceiling cap amending for this purpose Section 32(B)(7)(E) of the National Internal Revenue Code of 1997.
Both chambers of Congress approved their versions of the bill on third and final reading. Now that the bill is ratified, it will no longer go through a bicameral conference for both chambers of Congress to consolidate the bill. It will go directly to the President for him to either approve or veto the bill.
The tax exemption covers all bonuses, including 13th month pay and Christmas bonus.
Marikina Representative Miro Quimbo, who chairs the House ways and means committee, said the tax exemption cap would only be felt on June 2015 when workers will receive the first half of their 13th month pay.
“We have consolidated the House and Senate bills on the higher exemption for tax on bonuses so that the people can immediately benefit from it,” Quimbo said.
Quimbo said the losses in government revenues due to the exemption will not exceed P5 billion.
The bill could not be implemented for this year due to the need to draft its implementing rules and regulations.
Now that the bill increasing the tax exemption cap is approved, the House would now focus on the bills seeking to lower the income tax, Quimbo said.
“The next battle is now on the income tax,” Quimbo said.
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