Poe to push for lower income taxes if elected president
Lowering income taxes will be among the priorities of presidential aspirant and senator Grace Poe if she wins the 2016 national elections.
“I stand on a vision of genuine inclusive growth, and this is one of the most significant reforms a government can undertake to show its compassion for the millions of wage and salary workers who lose up to a third of their hard-earned income to unreasonably high taxes,” Poe said in a statement on Saturday.
Poe cited that under the Philippines’ current income tax bracket system, a Teacher 1 who makes roughly P18,000 per month pays over P14,000 in annual taxes if he or she is single and has no dependents.
“Halos isang buwang sweldo and napupunta sa buwis. Isipin natin kung gaano kalaking bagay para sa ating mga kababayan kung maibabalik natin ang ganitong halaga sa kanila sa pamamagitan ng pagbababa ng buwis,” the senator said.
(Nearly a month’s worth of salary goes to income taxes. Think of how significant it would be for our countrymen if that amount would be given back to them by way of lower taxes.)
She said the “increase in the annual take-home pay of a Teacher 1 due to lower taxes could buy more food for the family or provide an elderly with medicines or even serve as allowance for kids in school.”
The Bureau of Internal Revenue (BIR) has said that 85 percent of the total taxes on compensation and business come from wage and salary workers, who comprise more than half of the country’s labor force.
“Iyang extrang pera na makukuha ng mga mamamayan ay babalik rin naman sa ekonomiya dahil gagastusin din iyan ng mga tao para sa pang-araw-araw na pangangailangan o kaya naman ay para mag-invest,” Poe said.
(The extra money that the people would regain will go back to the economy since this will be spent for daily commodities or in investment.)
Since the Tax Reform Act was passed was passed in 1997, tax brackets in the Philippines have not changed.
Despite this, salaries have been adjusted to inflation, pushing more wage and salary workers into higher brackets, compelling them to pay higher taxes.
Poe noted that the 32-percent individual income tax rate in the Philippines for income over P500, 000 is among the highest tax rates in Asia.
“Sa palagay ko, panahon na para gawin ang re-bracketing na hinihingi ng ating mga kababayan matapos ang halos dalawang dekada na hindi man lang ito nagalaw,” she said.
“Kitang-kita naman natin ang epekto nito sa spending power ng mga Pilipino. Halos wala ng natitira sa sweldo pagakatapos ng deductions sa tax, insurance at iba pang contributions. Kaya karamihan sa ating mga guro, halimbawa, ay nababaon sa utang,” she added.
(I think it’s time for us to do the re-bracketing that our countrymen have been asking for after almost two decades of it being at a standstill.
We can clearly see its effect on the spending power of the Filipinos. Almost nothing is left of their salary after the deductions from tax, insurance and other contributions. This is why most of our teachers, for instance, are drowning in debt.) CDG