Presidential Spokesperson Harry Roque, Jr. on Tuesday, December 19, assured that the Tax Reform for Acceleration and Inclusion (TRAIN) package will reduce the burden of Filipinos from paying income taxes.
“(I)t will spare 99 percent of our population from the payment of income taxes because those earning not more than P250,000 per annum will now be tax exempt,” the Spokesperson explained in a press briefing in Malacañang.
With the enactment of Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion Act, taxpayers will see reduced personal income taxes in their paychecks.
For instance, a minimum wage earner with P12,000 monthly salary or a clerk receiving a P15,000 salary per month will now be tax exempt. Even a call center agent, who earns P21,000 monthly but used to file a P22,000 annual income tax return, will also be exempted.
On the other hand, a public hospital doctor with P57,000 monthly salary who used to pay P138,000 in taxes will be able to save P48,000 from taxes.
For the small- and micro-entrepreneurs, a simplified tax rate of 8 percent on gross sales will be implemented in lieu of income and percentage taxes.
Meanwhile, estate tax, or the tax paid by a deceased person’s estate, is now lowered from up to 20 percent to a fixed rate of 6 percent for the net estate with the standard deduction of P5,000,000.
Donors’ tax, or a tax on a donation or gift, is also lowered from up to 15 percent to a 6 percent fixed rate of net donations above P250,000 yearly.
With regard to the value-added tax (VAT), there were 54 special laws repealed with non-essential VAT exemptions.
Roque, however, confirmed that medicine for diabetes, high cholesterol, and hypertension are spared from the VAT, and purchases of senior citizens and persons with disability continue to be VAT-exempt.
In addition, TRAIN will allocate funds for cash transfer to the poorest of the poor to cushion the impact of indirect taxes on them.
“There is cash transfer provided in the law itself. Ten million households will receive cash transfer of P200 per month in 2018 and P300 per month in 2019 and 2020,” Roque said.
‘3rd telco up and about by Q1 2018’
In the same press briefing, Secretary Roque announced that President Rodrigo Duterte had instructed the Department of Information and Communications Technology (DICT) and the National Telecommunications Commission (NTC) to fast track the entry of a third telecommunications provider.
Roque said the President is serious on the entry of a third telecoms player as he wanted it ‘up and about’ by the first quarter of 2018.
“The NTC and DICT were tasked to approve all applications and licenses within seven days only upon complete submission of requirements. And that if it is not approved within seven days, it is deemed approved,” the President’s spokesperson disclosed. ###PCO-Content