In 2017, The Train Law revolutionized taxation in the Philippines as it was seen to financially empower

the people by reducing personal income tax. However, it was also seen in a negative light because of
drastically inflated consumer prices due to the increase in custom duties on petroleum products and
sweetened beverages. Research on the significant provisions of the TRAIN Law and analyze their
implications by citing concrete examples. After your analysis, give your personal view on the issue.

Taxes are the involuntary fees of individuals that will be the funds of different government
department in making projects and programs to govern the country. December 2017, President Duterte
signed into law the Republic Act No.10963 or the Tax Reform for Acceleration and Inclusion Act,
popularly known as the TRAIN Law. According to the National Tax Research Center (2017), The TRAIN
aims to make the Philippine Tax System simpler, fairer, and more efficient to promote investments, create
jobs and reduce poverty.
The law covers the reduced personal income tax wherein employees with an annual income of
Php250,000 below are exempted from paying tax. While those who have more than income of
Php250,000 are obligated to pay bigger contribution of tax. Additionally, the 70% of tax revenue
collected under TRAIN law are entrusted for the Build Build Build program which is a government
project that focuses on hiring thousands of Filipinos for the construction of public infrastructures in the
country. While the remaining 30% of tax revenue will go to social services. The TRAIN law also covers
the increases in taxes for sweetened and carbonated beverages, as well as cigarettes to encourage healthy
lifestyle. Furthermore, the law also except the VAT in drugs and medicines prescribed for diabetes, high
cholesterol and hypertension. Aside from drugs and medicines, VAT exemptions are also covered in
association dies, membership fees, and other assessments and charges collected by homeowner’s
association and condominium corporations.
On the other hand, as the personal income tax were reduced, the prices of most products and
services are increased to make up for loss on revenue. This includes increased prices of diesel, gasoline
and other fuel products whereas increases the cost of transportation that also greatly affected other
products.
In my opinion, the law is not fit for all. As those people who have annual income of Php250,000
are only covered in the reduced personal income tax, those who have irregular jobs are only left with
increased prices of products that barely sustain the needs of family. Also, though the law promotes
healthy lifestyle, the increased price of fuel products greatly influences the price of other products. Thus,
even a person is having a healthy lifestyle, it does not leave the fact that he is also experiences inflation
rate of other products and social services. In general, the law is good, but not for all Filipinos. It is
important that the law prioritize the people, and not only those who have regular jobs. If I have a chance
of changing the law, I’ll improve it by increasing foreign products, and lowering the prices of eco-
friendly and local products. In this way, local products are greatly promoted and all families including the
poor, are capable of sustaining their needs.

Reference
National Tax Research Center (2017). Tax Changes You Need to Know. Retrieved from
http://www.ntrc.gov.ph/images/Publications/train/tax-changes-you-need-to-know.pdf