Tax on bonuses, perks applies to all, says Henares

Internal Revenue Commissioner Kim Henares: Fair and just. INQUIRER FILE PHOTO

MANILA, Philippines—Internal Revenue Commissioner Kim Henares on Thursday clarified that the law that taxes benefits and perks, including the 13th-month pay exceeding P30,000, is applied to all employees, whether they are union or non-union members.

Henares made the clarification in response to the pronouncements of the Confederation for Recognition and Advancement of Government Employees (Courage) decrying the Bureau of Internal Revenue’s memorandum circular stating that benefits obtained by the unions of all state workers under the collective negotiations agreement (CNA) were now also subject to taxes if these exceeded P30,000 when combined with other perks.

Henares said that under the law, benefits and perks amounting to P30,000 are exempted from taxes but the BIR comes in when these benefits exceed P30,000.

“I want to make it clear that the law (Tax Code) is implemented across-the-board, to all workers—government employees, private employees, whether union or non-union employees,” she told reporters at the Department of Justice.

And this applies to all government employees whether they are under the executive, legislative, judiciary and constitutional commissions, according to the BIR chief.

She also issued the reminder for all heads of agencies and their accountants in both government and private sector to observe this tax rule or they could be held criminally liable.—Christine O. Avendaño