<\/p>\n
By Justine Irish D. Tabile, <\/b>Senior Reporter <\/i><\/span><\/p>\n TWO TAX RELIEF MEASURES<\/span> proposed<\/span> by President Ferdinand R. Marcos, Jr. <\/span>would profit no less than 3.13 million staff and 78,000 small businesses but cost the federal government about P66 billion in annual foregone revenue, the Department <\/span>of Finance (DoF) said.<\/p>\n Finance Secretary Frederick D. Go on Wednesday said raising the annual income tax exemption threshold to P350,000 from P250,000 would scale back revenues by about P60 billion a yr, while exempting small businesses from the minimum corporate income tax <\/span>(MCIT) would cost one other P6 billion.<\/p>\n \u201cThe proposal will profit no less than 3.13 million staff, including an extra 1.2 million staff on the minimum who will now not pay personal income tax, increasing the overall variety of tax-exempt staff from no less than 5.1 million to six.3 million,\u201d he said.<\/p>\n Mr. Go noted those earning between P250,000 and P350,000 annually will enjoy as much as P15,000 in additional take-home pay, while those earning greater than P350,000 could receive as much as P17,500 more.<\/span><\/p>\n \u201cThis implies, after all, that there shall be an even bigger share of hard-earned income that may go towards on a regular basis needs,\u201d he said.<\/span><\/p>\n The DoF also said that around 78,000 businesses will profit from the proposal to exempt micro and small enterprises from the minimum corporate income tax. This includes small bakeries, caf\u00e9s, eateries, food stalls, sari-sari <\/i>stores, repair shops, and other family-run businesses.<\/p>\n At present, qualified small corporations pay either the two% MCIT based on gross income or the regular 20% corporate income tax based on net taxable income, whichever is higher, regardless if the companies are operating at a loss.<\/p>\n Removing the MCIT would mean that covered businesses incurring losses would now not should pay the tax. Profitable corporations would remain subject <\/span>to the regular corporate income tax.<\/span><\/p>\n \u201cFrom this particular measure, if it happens, [foregone revenue will amount to] P6 billion annually,\u201d Mr. Go said.<\/span><\/p>\n To offset the revenue losses, he said the federal government could consider imposing more excise taxes but didn’t elaborate.<\/span><\/p>\n \u201cAll you have got to do is take a look at the categories which can be taxed with excise taxes, and normally, they might be the identical indus<\/span>tries that might be covered,\u201d Mr. Go said.<\/span><\/p>\n Earlier, House Committee on Ways and Means Chair and Marikina Rep. Romero \u201cMiro\u201d S. Quimbo said the federal government plans to totally offset the revenue losses through higher excise taxes on vape products, heated tobacco, and sugar-sweetened beverages.<\/p>\n Deloitte Philippines Business Tax Leader Senen Quizon said removing the MCIT will allow small businesses \u201cto be higher positioned to preserve money flow and pursue latest opportunities.\u201d<\/p>\n \u201cIt could entail short-term foregone revenue for the federal government, however the longer-term profit lies in easing pressure on small enterprises, improving their capability to grow and ultimately strengthening the country\u2019s revenue base through expanded economic activity,\u201d he told BusinessWorld<\/i> via e-mail.<\/p>\n Asian Consulting Group Founding Chairman and Chief Tax Adviser Raymond A. Abrea said greater relief could come from expanding the coverage of the optional gross income tax regime, even when its rate is increased.<\/p>\n Under the Tax Reform for Acceleration and Inclusion law, qualified self-employed individuals and professionals with annual gross sales or receipts of not more than P3 million may opt to pay an 8% tax on gross sales or receipts as a substitute of <\/span>graduated income and percentage taxes.<\/p>\n \u201cWhat we\u2019re advocating is to extend the optional tax from 8% to 10%, but the edge from P3 million to P20 million,\u201d Mr. Abrea said.<\/p>\n The next threshold could encourage more online sellers, self-employed staff and professionals to register, accurately declare their income and pay taxes, he added.<\/p>\n Nonetheless, Foundation for Economic Freedom President Calixto V. Chikiamco described Mr. Marcos\u2019 proposals as populist measures that fail to deal with the country\u2019s underlying political and economic problems.<\/p>\n \u201cThe solutions [he] proposed are all populist \u2014 giveaways, tax reliefs, et cetera. However it doesn\u2019t go to the foundation of the issue in our politics and in our economy,\u201d he said in an interview on Money Talks with Cathy Yang<\/i> on One News on Wednesday.<\/p>\n Mr. Chikiamco warned that granting tax relief without identifying suff<\/span>icient revenue offsets could worsen fiscal risks and potentially affect the country\u2019s credit rankings.<\/p>\n \u201cThis might affect even our rankings if the federal government isn’t capable of discover clear sources of revenue to compensate for all of those giveaways and tax reliefs,\u201d he said.<\/p>\n The National Government\u2019s budget deficit widened by 2.8% to P786.8 billion in the primary half from P765.5 billion a yr earlier.<\/p>\n The six-month fiscal gap was such as 47.4% of the federal government\u2019s revised P1.659-trillion deficit ceiling for 2026, which is such as 5.4% of gross domestic product.<\/p>\n BILLS FILED House Bill No. 10345 seeks to extend the annual income tax exemption ceiling by P100,000 from the present P250,000 under the Tax Reform for Acceleration and Inclusion law, allowing more Filipino staff to keep a bigger portion of their earnings.<\/span><\/p>\n The bill seeks to amend Section 24 of the National Internal Revenue Code by restructuring the graduated income tax rates imposed on Filipino residents and resident aliens.<\/p>\n Under the bill, taxable income exceeding P350,000 but not greater than P400,000 can be subject to a 15% income tax. Taxable income above P400,000 would remain subject to the present graduated tax rates of 20%, 25%, 30%, and 35%.<\/p>\n Under the proposal, married taxpayers would proceed to file and compute their income taxes individually, with any income that can not be exclusively assigned to ei<\/span>ther spouse split equally between them.<\/span><\/p>\n The measure would also preserve the income tax exemption granted to minimum wage earners, covering their taxable income in addition to holiday pay, extra time pay, night shift differential, and hazard pay.<\/span><\/p>\n It will likewise allow qualified self-employed individuals and professionals to proceed availing of the optional 8% tax on gross sales, receipts, and non-operating income exceeding the proposed P350,000 tax-exempt threshold, in lieu of the graduated income tax rates and percentage tax.<\/span><\/p>\n Meanwhile, Senate President Pro Tempore Vicente C. Sotto III filed Senate Bill No. 2338 that also seeks to exempt those earning P350,000 a yr from income tax.<\/p>\n Nonetheless, Senate Finance Committee Chairperson Joseph Victor \u201cJV\u201d G. Ejercito filed Senate Bill No. 2341 that goals to boost the income tax exemption ceiling to P600,000.<\/p>\n Under the measure, taxable income exceeding P600,000 but lower than P2 million shall be subjected to a 15% tax rate. \u2014 with<\/i> Pexcel John Bacon<\/b> and<\/i> Kaela Patricia B. Gabriel<\/b><\/p>\n<\/p><\/div>\n <\/p>\n","protected":false},"excerpt":{"rendered":" Employees perform repair work around Plaza Miranda in Manila. \u2014 PHILIPPINE STAR\/RYAN BALDEMOR By Justine Irish D. Tabile, Senior Reporter TWO TAX RELIEF MEASURES proposed by President Ferdinand R. Marcos, Jr. would profit no less than 3.13 million staff and 78,000 small businesses but cost the federal government about P66 billion in annual foregone revenue, […]<\/p>\n","protected":false},"author":1,"featured_media":374035,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[1643,1355,18541,48581,54385,1239,15265,26346,2780,4311],"class_list":["post-374034","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-benefit","tag-cost","tag-dof","tag-foregone","tag-p66b","tag-plan","tag-relief","tag-revenues","tag-tax","tag-workers"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t
<\/b>Meanwhile, House Speaker Faustino <\/span>\u201cBojie\u201d G. Dy III and Ilocos Norte Rep. Ferdinand Alexander \u201cSandro\u201d A. Marcos filed a bill that might raise the annual <\/span>tax-free income threshold to P350,000. <\/span><\/p>\n