It’s approved! Change is coming?
Now that President Rodrigo Duterte has approved the Tax Reform for Acceleration and Inclusion (TRAIN) Act, all self-employed and professionals who have below P250,000 annual income/salary – or 20,833 monthly – will be exempted from income tax as early as the first paycheck of 2018 .
Budget Secretary Benjamin Diokno said on Tuesday in Malacañang: “Doon sa salary nila, ma-adjust na iyong withholding tax. It will be adjusted. So iyong take home pay mo, tataas na kaagad-agad. Immediate iyong effect.” [From their salary, the withholding tax will be adjusted, so the take home pay will instantly increase. The effect is immediate].
Those in other income brackets (higher than annual P250K) will also have lower income tax rates.
The President himself said that the TRAIN would take effect starting January 1, 2018.
“This is the administration’s biggest Christmas gift to the Filipino people as 99 percent of the taxpayers will benefit from the simpler, fairer, and more efficient tax [program],” he said.
Initially, under the first package of the tax reform bill, the personal income tax exemption was for the first P150,000 ANNUAL income. But in November, 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.
Other tax adjustments like in mining, estate, soft drinks, petroleum, cosmetics, coal, etc. are also included in the new law. Read more about this