246 solons voted administration tax reform package | BICOL TODAY

246 solons voted administration tax reform package

House of Representatives. Photo courtesy of Youthpinoy.com

By Felix ‘Boy’ Espineda, Jr.

QUEZON CITY – The tax reform package which seeks to lower personal income tax, at the same time raising the excise tax on oil and vehicles, which also expands the value-added tax base and imposing tax on sweetened beverages and lotto winning gained the support of 246 members, with nine negative votes coming from the Makabayan bloc and one abstained when House Bill 5636 was approved on third reading Wednesday. The measure amends a certain provision of the National Internal Revenue Code and was hailed as a pro-poor tax package.

Senior Citizens, PWD’s, salaried workers gained from the measure because of retention and expansion of their tax privileges which tax reform advocates since the 16th congress labeled as a heavy burden for ordinary workers.

The estimated range from more than a million ordinary workers will be exempted from paying income taxes who, for years, are saddled in paying income taxes to finance government spending.

The bill was certified urgent by Malacanang and its passing hurdled the first step in increasing the country tax collection before its final version after a bicameral conference committee between the House and Senate contingents.

It also retained the tax exemption of cooperatives after the strong lobby of partylist representatives representing the cooperative sectors whose members been trooping Congress and campaigning their respective district representative to be with their cause. Retained are the sales of agricultural cooperatives, its gross receipts from lending activities by credit or multi-purpose cooperatives also included are sales by non-agricultural, non-electric and non-credit cooperatives. It took 168 house members calling for the retention of the exemption under RA 9520, the Cooperative Code of 2008, the tax, the finance department estimated to collect at least 6 billion pesos annually from the cooperatives.

The approved bill put conditions on the removal of VAT exemptions on socialized housing, in the auto excise tax segment, the bill put an ad valorem tax on automobiles based on the manufacturer’s or importer’s selling price, net of excise and value-added tax.

In the personal income tax, those earning 250,000 yearly will enjoy tax exemption, and those earning 250,00 to 400,000 will pay 20% tax on the excess over P250,000.

According to the tax schedule, effective 2021 onwards, taxpayers earning up to P250,000 a year will still enjoy personal income tax exemption, while those earning P250,000 to P400,000 will pay a 15-percent tax on the excess over P250,000.

Those earning P400,000 to P800,000 will pay P22,500 plus 20 percent of income in excess of P400,000.

Effective 2019, the automobiles excise tax will be raised to four percent if the net manufacturer’s price/importer’s selling price is up to P600,000. From P600,000 to P1.1 million, the tax rate will be P24,000 plus 40 percent of value in excess of P600,000. The present tax rate is P12,000 plus 20 percent of value in excess of P600,000.

Effective 2018. the bill impose an excise tax on diesel fuel oil, kerosene, liquefied petroleum gas and bunker fuel oil of P3 per liter, it will increase to P5 on 2019 and P6 in 2020.

In the current tax system excise tax are not imposed on them.The bill seeks to impose on diesel fuel oil, kerosene, liquefied petroleum gas and bunker fuel oil a P3 per liter excise tax effective 2018, P5 per liter excise tax effective 2019, and P6 per liter excise tax effective 2020. Under the current tax system, these products are not collected with an excise tax. Same increase to the existing excise tax on lubricating oils and greases, processed gas, waxes and petrolatum, denatured alcohol for motive power, naphtha, regular gasoline, leaded premium gasoline, aviation turbojet fuel, and asphalts.

From the original proposal of three years, the allocation of 40 percent yearly incremental revenues from the petroleum excise tax intended for social programs was changed to four years.

It also seeks to remove the tax exemption on the Philippine Charity Sweepstakes Office and lotto winnings. The bill removed the PCSO lotto winnings as an exemption to the 20 percent tax on interests, royalties, prizes and other winnings.

The approved bill also includes in the National Internal Revenue Code the increase in the tax exemption for the 13th month pay and other benefits to P100,000 from P82,000, earlier pass in the 16th congress.

The approved bill also puts a final tax of 30 percent, amending the National Internal Revenue Code which earlier puts the tax at 32 percent as of 2000, on the grossed-up monetary value of fringe benefit furnished or granted to the employee (except rank and file employees) by the employer, but will form part of taxable income of recipient employee subject to regular tax rate by 2022.

Posted by on June 4, 2017. Filed under Nation,Top Stories. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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