Senator Jinggoy Estrada has filed Senate Bill No. 1685 proposing lower individual income tax rates, including a full exemption for those earning ₱500,000 or less annually.
The measure seeks to amend Section 24 of the National Internal Revenue Code of 1997 and revise income tax brackets beginning in 2027.
Estrada said the proposal aims to boost take-home pay and help Filipino families manage rising living costs.
“Kapag mas malaki ang natitira sa sahod, mas nakakagastos ang pamilya, mas umiikot ang pera sa ekonomiya at mas gumaganda ang kalidad ng buhay,” Estrada stated.
Under the bill, individuals earning above ₱500,000 annually would still pay taxes but at lower rates than those imposed under the current system.
Estrada emphasized that low- and middle-income earners have yet to fully feel the benefits of previous tax reforms due to persistent inflation.
As a former chair of the Senate Committee on Labor, he noted that the proposal is meant to strengthen the gains of the Tax Reform for Acceleration and Inclusion Law (TRAIN), which reduced personal income taxes but was offset by rising prices of goods and services.
He cited a 2022 study by the Al-Kindi Center for Research and Development showing that inflation eroded the nominal increases in take-home pay under TRAIN.
Estrada said the bill would narrow this gap by increasing workers’ disposable income, allowing families to better manage daily expenses, save for emergencies, and invest in education.
“Ang panukalang ito ay tungkol sa pagbibigay sa ating mga manggagawa ng patas na pagkakataon para sa mas maayos na buhay,” he said.
“Ang mas mababang buwis ay nangangahulugan ng mas malaking take-home pay, at ang mas malaking take-home pay ay katumbas ng mas matatag na pamilya at mas matibay na bansa,” he added.