Team DailyPedia
Navotas City Rep. Tobias “Toby” Tiangco has filed a measure seeking to raise the annual income tax exemption threshold from ₱250,000 to ₱350,000, a move he said would provide much-needed relief to Filipino workers amid rising living costs.
Under House Bill No. 10451, individuals earning ₱350,000 or less in annual taxable income would no longer pay income tax. The proposal also adjusts the succeeding income tax brackets to preserve the country’s progressive tax system and ensure that taxpayers across different income levels also benefit from the reform.
The bill was filed following President Ferdinand Marcos Jr.’s call during his recent State of the Nation Address for Congress to study additional tax relief measures for Filipino workers.
According to Tiangco, the proposed measure would not only exempt more workers from paying income tax but also reduce the tax burden of those earning above the new threshold.
“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.”
The lawmaker said the country’s tax system should keep pace with the rising cost of living.
“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. Hindi lang tax exemption ang layunin ng batas na ito. Inaayos din natin ang tax schedule para maging mas patas sa lahat ng manggagawa, lalo na sa middle class na madalas naiipit—hindi sapat ang kita, hindi kwalipikado sa ayuda, pero lubos na apektado ng pagtaas ng presyo ng mga bilihin.”
Tiangco noted that the existing ₱250,000 tax-free threshold has remained unchanged since the Tax Reform for Acceleration and Inclusion (TRAIN) Law took effect in 2018, despite years of inflation that have reduced the purchasing power of Filipino households.
Citing data from the Philippine Statistics Authority, the bill states that inflation has significantly increased the cost of food, housing, electricity, transportation, and other basic necessities, making an adjustment to the tax brackets both timely and necessary.
Tiangco also argued that allowing workers to retain more of their income would have a positive impact on the broader economy.
“Kapag mas malaki ang naiuuwi ng mga manggagawa, mas may kakayahan silang gumastos. Nakakatulong ito sa mga lokal na negosyo at nagpapalakas sa ekonomiya. Ito ang tax reform na direktang pakikinabangan ng ordinaryong Pilipino.”
He added that the proposal is intended to ease the financial burden on the country’s working middle class, whose disposable income has steadily declined because of inflation.
“Our objective is simple: give hardworking Filipinos a fairer tax system that reflects today’s economic realities. This is one concrete way we can help families cope with rising costs while stimulating economic activity from the ground up.”
House Bill No. 10451 seeks to amend Section 24 of the National Internal Revenue Code by increasing the tax-exempt income threshold to ₱350,000 and revising the succeeding tax brackets accordingly to maintain the progressivity of the Philippine income tax system.
