Senate approves tax exemption for below 250K personal annual income (20,833 monthly); to take effect in January


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Initially, under the first package of the tax reform bill, the personal income tax exemption was for the first P150,000 ANNUAL income. But on Wednesday, the Senate Ways and Means Committee chaired by Senator Sonny Angara just approved a proposal by Senator Ralph Recto to increase the tax exemption to P250,000.

“Senator Recto proposed in the first year, [it will be implemented]. We accepted his amendment, so in full na ‘yun…You will pay less taxes, you have a bigger exemption,” said Angara.

He explained: “It’s available to anybody who earns more than P250,000, unlike before na minimum wage earner exempt pero kumita man lang siya ng P10,000 over the minimum wage, ‘yung buong halaga nagiging taxable [unlike before, a minimum wage earner exempt, but exceeds let’s say P10,000 over, the whole amount would become taxable].

Ito, P250,000 mo hindi pwede galawin ng gobyerno, kahit saan ka, kahit anong income mo [your whole 250,000 will be yours, wherever you are, no matter how much your income is,]” he added.

The Senate also implements the following tax schedule effective January 1, 2018 as follows (Data from Sen. Ralph Recto’s Office):

  • Over 250,000 but not over P400,000 – 20 percent of the excess over P250,000
  • Over P400,000 but not over P800,000 – P30,000 plus 25 percent of the excess over P400,000
  • Over 800,000 but not over P2 million – P130,000 plus 30 percent of the excess over P800,000
  • Over P2 million but not over P8 million – P490,000 plus 32 percent of the excess over P2 million
  • Over P8 million – P2.41 million plus 35 percent of the excess over P8 million

 

 

This article has been viewed 7525 times. Article originally posted: November 24, 2017, 1:47 pm (UTC-0). Last update: November 24, 2017 at 1:47 pm (UTC-0).

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