MANILA: President Benigno has signed bill that increases the tax exemption cap for bonuses. The new law amends Section 32 of the National Internal Revenue Code of 1997 to raise the tax ceiling from P30,000 to P82,000.
The measure was approved by the Senate in November 2014 while the House of Representatives approved its own version last September. Marikina City Rep. Miro Quimbo, an administration ally, lauded the signing of the new law.”The president saw the significance of the measure as it is projected to benefit taxpayers from low to middle incomes who have not had any reprieve from the burdensome taxes imposed on their earnings,” Quimbo said in a statement.
“These are the salary and wage earners who long deserve a break from the inequitable tax system that we currently have,” added the lawmaker, one of the authors of the new measure and the chairman of the House committee on ways and means. President Franklin Drilon said earlier that the tax exemption for bonuses is needed “to provide relief to state and private workers whose purchasing power has been shrinking for years due to inflation, but still have had to deal with the consequences of an outdated law.”For his part, Sen. Sonny Angara, one of the authors of the new law, explained that the P30,000 tax ceiling had not been adjusted for 20 years.
After raising the tax exemption ceiling for bonuses, Quimbo said Congress is now preparing for deliberations on income tax reform, which would reduce tax rates.”The president recognizes the importance of having more tax reform measures benefitting the middle class, especially the salary and wage earners, with direct impact on the earnings they receive every month. So these are all forthcoming,” Quimbo said.
