Senators on Wednesday filed bills aiming to give workers’ higher take-home pay and to provide tax incentives for micro, small and medium enterprises (MSMEs).
Senator Sherwin Gatchalian proposed that workers earning PHP400,000 annually be exempted from paying annual taxes, instead of only those earning PHP250,000.
He also proposed to raise the cap on tax-free bonuses from the current PHP90,000 to PHP150,000.
“The working Filipinos have always carried the economy on their backs, it is time we lend them a hand and help them in their fight for better lives,” he said.
The lawmaker also proposed the removal of taxes on service charges received by service industry workers, the taxes on additional compensation such as overtime pay, holiday pay, night shift differential, hazard pay, and taxes on honoraria and allowances of election workers.
Additional measures include allowing the additional 50 percent deduction for micro taxpayers for labor expenses; allowing discounts for persons with disability, senior citizens, and solo parents as tax credits; and exemption for micro businesses from paying withholding taxes.
Meanwhile, Senate President Francis Escudero proposed that MSMEs be exempted from paying income tax for three years, to deduct from their taxable income the amount equivalent to 25 percent of their labor expenses, and to cut to 5 percent the optional tax on gross sales or receipts from the current 8 percent.
Escudero also raised the need to change the rates under the creditable withholding tax to 1 percent for purchases of goods and properties and 2 percent for the purchase of services; and to bring back the mandatory credit allocation for MSMEs for all credit service providers for 10 years.
“These will allow our MSMEs, particularly those that are struggling financially, to continue their operations, hire more people, and even consider an expansion in the future,” he said. (PNA)
