Moves to raise tax exemption cap on bonuses gain ground in House
Nueva Ecija Rep. Estrellita Suansing. Photo from https://www.facebook.com/athel.suansing
MANILA, Philippines – Moves to increase the tax exemption cap on bonuses gained ground in the House of Representatives as another lawmaker filed a similar proposed measure.
Nueva Ecija Representative Estrellita Suansing and Quezon Representative Angelina Tan filed House Bill 3974 seeking to increase to P75,000 the ceiling on the 13th month pay, Christmas bonus and other benefits to be excluded from the computation of taxable gross income.
The allowable tax ceiling cap has been set at P30,000 since Republic Act 7833 was in effect in 1994.
Suansing said in 1994, the lowest monthly basic salary for government employees is at P2,800 in the Salary Grade 1, Step l level and P25,000 for those occupying Salary Grade 33 positions.
Now, the basic salary is adjusted to P9,000 for Salary Grade 1, Step I positions and to P120,000 for Salary Grade 33, the lawmaker said.
Article continues after this advertisement“The P75,000 ceiling will be more responsive to the needs of the times,” Suansing said.
Article continues after this advertisementThe bill also seeks to amend Section 32(B) of the National Internal Revenue Code such that the gross benefits received by officials and employees of public and private entities would not be included in gross income and be exempt from taxation.
The bill is pending with the House ways and means committee.
Other similar bills have been pending in the lower chamber—House Bill 248 filed by ACT Teachers Rep. Antonio Tinio, HB 2835 by Makati city Rep. Abigail Binay, HB 3629 by Batangas Rep. Raneo Abu and HB 3670 by Iloilo city Rep. Jerry Treñas.
Both chambers of Congress agreed to pass the proposed measure especially as the “antiquated” provision of Republic Act 7833 needs to be amended, according to Senate President Franklin Drilon.
“The law was passed 20 years ago, and obviously, things have greatly changed – making such figures no longer reflective of current economic realities, thus making it even more difficult for the average Filipino worker to make both ends meet for him and his family,” Drilon said in a statement.
Bureau of Internal Revenue officials rejected the bills raising the tax exemption cap, saying government may lose as much as P40 billion if the proposed measure is passed.
RELATED STORIES
Gov’t to lose P40B in revenues if bill raising cap on tax exemption is passed
BIR bucks bills to raise tax exemptions
