MANILA - Government stands to lose up to P150 billion with the tax-free provision for individual income taxes and the increased cap on taxable bonuses under the Tax Reform for Acceleration and Inclusion (TRAIN) bill, Sen. Sonny Angara said Friday.
Individual income taxpayers earning less than P250,000 a year are exempt from paying taxes under the ratified first package of the tax reform bill, while the threshold for tax free 13th month pay and other bonuses was increased to P90,000.
The bill is currently awaiting President Rodrigo Duterte's signature.
“Ang napagkasunduan ng Kamara, ang P250,000 ay hindi na kailangan buwisan ng pamahalaan... P150 billion ang mawawala sa kita ng gobyerno,” Angara, chair of the Senate Committee on Ways and Means, told ABS CBN News.
(Congress agreed that the government will no longer impose taxes on those earning P250,000... the government will lose about P150 billion.)
Angara said tax hikes under some provisions, including raised levies on sweetened beverages, automobile and coal, were meant to make up for the loss.
Once the TRAIN bill is enacted into law, a P6.00 per liter tax on sweetened beverages and P12.00 per liter on those using high fructose corn syrup (HFCS) will be imposed.
Meanwhile, a 50 percent tax will be imposed on luxury cars with a net manufacturer’s price above P4 million. The automobile excise tax provision also dictates a 4 percent tax on mid-range vehicles with a net manufacturer’s price of up to P600,000, which are usually acquired by the working class.