Philippines Eyes Income Tax Exemption for P350K Earners, Seen as 'Wage Hike'

President Ferdinand Marcos, Jr.'s call to Congress to expand the income tax exemption to those earning P350,000 a year can be considered as a "wage hike" for the middle class, according to House ways and means panel chair Marikina 2nd District Rep. Miro Quimbo. Quimbo was referring to one of Marcos' legislative wish list that he mentioned in his 5th State of the Nation Address (SONA). “Pag nagde-desisyon ng Pangulo ng ganito, effectively, parang nagkakaroon ng wage hike. Ito ang middle class eh, na dating nagbabayad ng buwis; ngayon hindi na magbabayad ng buwis para mas malaki ang kanilang maiuwi na take-home pay,” Quimbo said in an interview on Super Radyo dzBB interview. (When the President makes a decision like this, it is effectively like a wage hike. This concerns the middle class—people who used to pay taxes but now won't, allowing them to bring home a larger take-home pay.) “We passed the Train law exempting those earning P250,000 annually from income tax in 2018. If you adjust it to inflation, of course the worth of the peso in 2018 is different today. It costs lower. So when you adjust that P250,000 to inflation, it (threshold) should be P320,000. But the President took the extra step and made it P350,000 so more people would be able to benefit from it,” she also said. Tax laws Quimbo then said that the House will immediately act on the President’s call. “We will finish this (pass this into law) by August because all tax laws, as provided by the Constitution, should emanate from the House of Representatives. Even the budget laws, it should emanate from the House according to our Constitution. The Senate cannot take this up unless we pass it on third and final reading,” Quimbo explained. “Kaya kailangan din po namin madaliin ito para umabot po sa kanila dahil may impeachment sila, may budgeteering pa tayo. So, para at least by next year ay ma-implement na ito sa ating mga empleyado,” Quimbo added. (So we really need to act on this quickly and send it to the Senate as soon as possible because they also have the impeachment on their hands, and we have the budget deliberations. So, that at least by next year, the employees will already be able to benefit from this.) Billionaires Quimbo, meanwhile, also said that imposing a wealth tax for the billionaires is best implemented by only imposing an estate tax on assets worth P100 million and above. “Billionaries’ assets do not all reflect in their income. Most of them earn from dividends, which are already covered by taxes,” Quimbo said. “Meanwhile, as it is, those who inherit assets way less than P100 million, which are only worth a few thousands, are paying estate taxes. We should remove that and impose estate taxes on those assets worth P100 million and above. If you have P100 million worth of assets and above to inherit, it means you are really loaded with money. This is just some of the ways that we can tax the ultra rich,” Quimbo added. —Llanesca T. Panti/ VAL, GMA News