Navotas City Representative Toby Tiangco has introduced House Bill No. 10451, which aims to raise the annual personal income tax exemption threshold from ₱250,000 to ₱350,000.
The proposal comes in response to President Ferdinand Marcos Jr.’s call during his fifth State of the Nation Address (SONA) on July 27, where he urged lawmakers to pass tax relief measures to help workers cope with the rising cost of living.
Key Provisions of HB 10451
- Tax-Free Earnings: Individual workers earning ₱350,000 or less annually will be completely exempt from paying personal income tax.
- Middle-Class Relief: Income tax brackets will be adjusted to maintain a progressive tax structure, providing annual tax savings of up to ₱15,000 for higher earners.
- Updated Threshold: The measure updates the ₱250,000 tax-exempt limit, which has remained unchanged since the implementation of the TRAIN Law in 2018.
Highlighting the practical impact of the proposed changes, Tiangco detailed how the savings would directly assist Filipino households:
”Sa panukalang batas, hindi na magbabayad ng income tax ang mga may annual taxable income na ₱350,000 pababa. Makikinabang din ang mga kumikita nang higit dito dahil maaari silang makatipid ng hanggang ₱15,000 sa buwis bawat taon. Katumbas ito ng dagdag na ₱1,250 sa kanilang buwanang kita na maaari nilang gamitin sa pagkain, pamasahe, kuryente, gamot, at iba pang pang-araw-araw na pangangailangan.”
Aligning Taxes with Economic Realities
Tiangco stressed that years of sustained inflation have eroded the purchasing power of families, making the current tax system outdated:
”Habang tumataas ang presyo ng pagkain, kuryente, pamasahe at iba pang pangunahing pangangailangan, dapat ding sumabay ang ating tax system sa realidad ng buhay ng mga Pilipino.”
He added that the legislation is designed to restructure tax schedules so that middle-class workers are not left behind:
”Hindi lang tax exemption ang layunin ng batas na ito. Inaayos din natin ang tax schedule para maging mas patas salahat ng manggagawa, lalo na sa middle class na madalasnaiipit—hindi sapat ang kita, hindi kwalipikado sa ayuda, perolubos na apektado ng pagtaas ng presyo ng mga bilihin.”