Leon Joaquin R.

Valdez

BSA 2-1

Income Taxation (Reflection paper about T.R.A.I.N Law)

The Tax Reform Acceleration and Inclusion Act (TRAIN Law), formally known as Republic Act
No. 10963, is the first package in the Comprehensive Tax Reform Program (CTRP) enacted by
President Rodrigo Duterte on December 19, 2017. . The TRAIN Act is the first of his four tax
reform packages to the 1997 National Internal Revenue Code, or Tax Code as amended. The
package changed personal income tax (PIT), inheritance tax, gift tax, value added tax (VAT),
stamp duty (DST), excise tax on tobacco products, petroleum products and sweetened
beverages.

The TRAIN Law provides us a certain goal envisioning the future of the Philippines on the year
2040. This ambition is named “Ambisyon Natin 2040” in order to achieve this main goal, the
government must first achieve the 5 sub goals. Based on the video that I watched provided by
the DOF or the Department of Finance, the 5 sub goals are are named “Pro-sahod Station”,
“Pro-Negosyo Station”, “Pro-Health R. Kalusugan Station”, Pro-Infra: BUILD BUILD BUILD
Station”, and “Pro-Poor Station”. The 5 sub goals has a station name at the end because the
video about the TRAIN Law is referred to a train that is going to the 5 sub goals or the stations
and at the end there is the last station or the main goal which is the “Ambisyon Natin 2040
Station”.

“Pro-sahod Station” the first sub goal which mainly focuses on income tax payers provides them
a higher take home pay, minimum wage earners or self-employed earners that has a salary
lower than 250,000 annually are exempted in the TRAIN Law.

Secondly, the “Pro-Negosyo Station” the second sub goal which is commonly aligned with the
first sub goal. Its main goal is to make the business owners to a have simple and reliable tax
payment procedure from their big or small businesses, it would provide them a simpler tax
system which includes shorter forms and less requirements to provide taxes for the
government.

“Pro-Health R. Kalusugan Station” based on its name, it prioritizes the health of every Filipino
citizen in the country. In the video it is said that senior citizens are the only ones exempted in
the value added tax (VAT) when buying medications for themselves but now people with
diabetes, hypertension, and high cholesterol are also exempted in the VAT along with the
presentation of their drug prescriptions. In line with this sub goal, the products that aren’t good
to the people’s health like cigarettes, soda drinks, and alcoholic beverages has a higher excise
tax in order implement the health consciousness of Filipinos.

The second to the last sub goal is the “Pro-Infra: BUILD BUILD BUILD Station” it doesn’t only
focusses on building infrastructures to improve the country, it also takes tax fund from the
petroleum products that is circulating in the country. A study has been found that 10% of the
richest household consumes more than half of the petroleum products in the country, it is an
advantage for the TRAIN Law on putting taxes in petroleum products because they have the
more capacity to provide more excise tax on the petroleum that they consume. 70% of the tax
fund from the TRAIN Law goes to the “BUILD BUILD BUILD Program” in order to make more
roads, trains, airports, bridges, and many more, to make it easier for the transportation of
goods, essentials, and tourism for the development of remote province areas. This 4 th sub main
goal would also help the government to build infrastructures that are durable enough to
withstand the natural calamities that our country is commonly facing.

Last but not the least is the 5 th sub goal, the “Pro-Poor Station” its main goal is to prevent
extreme and help those who are in need especially the senior citizens of this country. 30% of
the tax fund from the TRAIN Law will be going to programs like unconditional cash transfers
and “Pantawid Pasada Program”. Unconditional cash transfers will be given to financially
unstable families and senior citizens that could be affected by the excise tax of petroleum
products, on the other hand the “Pantawid Pasada Program” is for PUJ drivers (Public Utility
Jeepneys) which they will receive a fuel card containing P 5000 worth of fuel in order to lessen
their expenses on fuel, also in this sub goal free TESDA trainings are given to unemployed
citizens.

In conclusion this TRAIN Law is a very good law for the tax fund of this country. As a Filipino
citizen I’m gladly respecting this law because it is for the better development of the Phillippines
by the last station naming “Ambisyon Natin 2040” in order for our country to be like Thailand or
Malaysia knowing that there’s no extreme poverty could be seen in their country. All I could
wish for is that our taxes should be going to the right places and not into someone’s pocket just
to make them rich as the country’s leader.