Tag: tax relief

Middle income earners in the Philippines will have lower income taxes this year

Middle income earners in the Philippines will have lower income taxes this year

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Recently, it was emphasized that middle income earners here in the Philippines will have lower income taxes to pay in accordance to the Tax Reform for Acceleration and Inclusion (TRAIN) law (Republic Act Number 10963) which will result in better take-home pay this year, according to a news article published by the Philippine News Agency (PNA). This is related to what was reported weeks ago by GMA Network news.

To put things in perspective, posted below is the excerpt from the PNA news report. Some parts in boldface…

Middle-income earners will have lower income taxes this year and thus, higher take-home pay, under Republic Act No 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) law.

Taxpayers earning more than PHP250,000 a year but not over PHP8 million will be subject to lower income tax rates ranging from 15 percent to 30 percent, from the previous 20 percent to 32 percent.

Those with annual taxable income of PHP250,000 or below will continue to be exempt from paying income taxes.

“Inaasahan natin na lalo pang lalakas ang domestic consumption na may malaking kontribusyon sa paglago ng ating ekonomiya. Dahil sa pinababang buwis, mas mataas ang take-home pay ng mga empleyado na magiging malaking tulong sa gitna ng mataas na presyo ng mga bilihin (We expect a stronger domestic consumption which will be big contribution to our economy. With lower tax and higher take-home pay, this will be a good help amid the rising prices of commodities),” Senator Sherwin Gatchalian said in a statement on Monday.

Gatchalian cited the Teacher 1 post, with a monthly salary of PHP25,439 or Salary Grade (SG) 11, will now have monthly tax savings of PHP420.83 or PHP5,050 for the year.

A Nurse III with SG 17 or an entry level monthly income of PHP43,030 will save PHP1,289.13 monthly or PHP15,469 yearly.

“Dahil sa mas mataas ang kanilang kita, inaasahan din natin na magiging maganda itong insentibo para sa mga empleyado na lalo pa nilang paghusayan ang kanilang trabaho at magtulak sa kanila para mag impok o kaya ay mamuhunan (Because of a higher take-home pay, workers will be inspired to work better, save and invest), Gatchalian said.

Also included in the TRAIN law are provisions for small and micro self-employed professionals, who now have the option to pay a simpler, flat tax of eight percent on gross sales in lieu of the income and percentage tax.

Taxpayers can save time falling in line and filing and paying from eight times a year will be reduced to just four.

Estate tax will also be lowered from 20 percent to a single rate of six percent for net estate with standard deduction of PHP5 million as well as exemption for the first PHP10 million for the family home.

Let me end this piece by asking you readers: What is your reaction to this new development? Are you qualified for a reduction of income taxes under the TRAIN Law? Have you consulted with a certified tax expert already?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Muntinlupa City extends tax relief anew, penalties for late payment waived until December 29, 2020

Muntinlupa City extends tax relief anew, penalties for late payment waived until December 29, 2020

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The City Government of Muntinlupa announced yesterday its move to relax the collection of penalties for late payment of business taxes from the second quarter until the remainder of the year in a bid to help the private sector to recover from losses due to the COVID-19 pandemic.

Mayor Jaime Fresnedi signed City Ordinance 2020-150 waiving penalties and surcharges incurred for the non-payment of business taxes from 2nd to 4th quarter of 2020 as assistance to the business sector.

Fresnedi said as the effects of COVID-19 pandemic further intensify the hurdles being faced by the private sector, the City Government of Muntinlupa as a partner to business sector will extend its assistance by providing for tax reliefs.

However, all business taxes due for the said period shall however be subject to the penalties and interest prescribed by Muntinlupa Revenue Code if not paid on or before December 29, 2020. Muntinlupa City Business Permits and Licensing Office advised business taxpayers in the city to settle all outstanding balances on or before the deadline to avoid incurring penalties.

Earlier this year, Muntinlupa City has imposed several extension of deadlines for the payment of taxes and fees amid the community quarantine in Metro Manila.

In May, Muntinlupa City Council adapted the Department of Finance (DOF) Department Circular (DC) No. 002-2020 through City Ordinance 2020-095 for the uniform adoption and implementation on the extension of deadlines for the payment of local taxes, fees, and charges imposed by local government units from March 25 to June 25, 2020.

Read the details closely. (source – Muntinlupa PIO)

The City Government of Muntinlupa has also passed ordinances in March providing a two-month payment extension on Real Property Tax payments and other payables to the City Government for the 1st Quarter, including payment for business taxes and fees for the 2nd Quarter, without penalties, surcharge, and interest. Penalties and surcharges incurred for the non-payment of 2nd and 3rd quarter business taxes were also waived through City Ordinance 2020-146.

The Philippine Chamber of Commerce and Industry – Muntinlupa recognized the City Government’s implementation of the Local Economic Continuity Plan which outlines programs and activities for business adaptation in the time of the pandemic and future programs for economic recovery.

PCCI-Muntinlupa president Elvie Sanchez-Quiazon conferred the Sterling Growth Catalyst Award to Mayor Fresnedi in recognition of his leadership in addressing the health crisis while still boosting the sustainability of local economy last July. Quiazon said the local chamber lauds the mayor’s “transformational and adaptable leadership, commitment and eminent public service to boost the development and sustainability of the Muntinlupa City in challenging times.”

As of November 25, Muntinlupa City has 4,867 confirmed cases with 4,666 recoveries, 43 active cases, 158 reported deaths, 43 suspect cases, and 234 probable cases.

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Latest City Government of Muntinlupa details sourced from their official media release. Some parts were edited for this website.

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