Lawmaker seeks hike in basic personal exemptionfor taxpayers & additional exemption for their dependents
A party-list lawmaker is seeking an increase in the basic personal exemption for individual taxpayers from P50,000 to P75,000 and the additional exemption for dependents from P25,000 to P40,000 to ease the income tax burden on ordinary working people.Rep. Antonio Tinio (Party-list, ACT Teachers) said his proposal embodied in HouseBill 247 will allow the lowest-paid government employee to take home a non-taxableincome of at least 69 percent of his annual pay. Meanwhile, the middle-level publicservant and the minimum wage earner will be assured of 34 percent and 53 percent of their incomes, respectively according to him.Tinio said his proposal will restore the 2008 levels wherein the basic personalexemption of P50,000 was 68 percent of the annual salary of the lowest-paid governmentemployee (Salary Grade 1 at P6,149 per month), 33 percent of that of a middle-levelgovernment employee (Salary Grade 11, P12, 748 per month, and 6 percent of that of thePhilippine President (Salary Grade 33, P69, 878 per month). It was 42 percent of theannual basic pay of the minimum wage earner in the private sector in the National CapitalRegion, which was P382 per day.Presently, he said the basic personal exemption of P50,000 stands at 46 percent of the annual salary of the lowest-paid government employee (Salary Grade 1 at P9,000 per month), 22 percent of that of a middle-level government employee (Salary Grade 11 atP18,549 per month), 3 percent of that of the President (Salary Grade 33 at P120,000 per month), and 35 percent of that of the minimum wage earner (P11,780 per month).“Per constitutional mandate, taxation must be equitable and progressive. By these principles, income earners from the lowest strata, especially purely compensation incomeearners, are to be taxed less and given more opportunities to decrease their taxableincomes. They comprise the majority of the income taxpayer base, and the State can do noless than increase the amounts they can take home to their families,” said Tinio.He also proposed in HB 247 to give to the Commissioner of Internal Revenue theduty to annually review these exemptions in relation to current living costs andrecommend necessary adjustments to Congress. Based on the adjustments to the personalexemptions in the past two decades, he noted that Congress has been slow to respond tothe needs of the people by increasing these amounts in a timely manner to keep up withthe rising cost of living.
NR # 3201AUG. 20, 2013