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[av_heading heading=’Tax reform bill closes in on becoming law’ tag=’h3′ style=’blockquote modern-quote’ size=’30’ subheading_active=’subheading_below’ subheading_size=’15’ padding=’10’ color=” custom_font=” av-medium-font-size-title=” av-small-font-size-title=” av-mini-font-size-title=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” admin_preview_bg=”][/av_heading]
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Thursday, November 30, 2017
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MANILA – One of President Rodrigo Duterte’s priority economic measures moved closer to being enacted into law.
With 17 affirmative votes and one abstention, Senate approved the other day the Tax Reform for Acceleration and Inclusion (TRAIN) bill on third and final reading.
Workers earning P250,000 a year will be exempted from paying income taxes under the measure, the office of Sen. Sonny Angara, one of the authors of the bill, said in a statement.
Around 6.8 million income earners will be exempt from taxes while up to 7.5 million individual income taxpayers will enjoy lower tax rates, Angara’s office said.
The TRAIN bill targets raising P100 billion to P130 billion in revenues to finance the “Build, Build, Build” program of the Duterte administration.
The Senate now needs to reconcile its version of the bill with the one the House of Representatives approved earlier.
“We hope that with its swift action on the measure, the two chambers of Congress can soon sit down in the bicameral conference committee to thresh out a reconciled version of the bill that would provide the most benefit for majority of the Filipinos,” Finance secretary Carlos Dominguez said in a statement.
Government economic managers hope to implement the tax reform measures next year.
Duterte is seeking to fulfill a campaign promise to lower personal income tax rates, which will be offset by higher duties on fuel, cars and sugar-sweetened products.
“TRAIN is an important part of our expansionary fiscal policy,” Budget secretary Benjamin Diokno said in a statement.
Additional revenue from tax reform will also help fund the President’s P8-trillion infrastructure program, which includes the first subway in Metro Manila and railway in Mindanao.
Meanwhile, Sen. Sherwin Gatchalian reminded the Finance department to “keep its end of the bargain” by protecting the poor from the expected increase in the prices of essential commodities.
Gatchalian called for the implementation of a cash transfer program if the TRAIN bill is signed into law next year.
“The government has promised to roll out an expanded cash transfer program to shield 10 million impoverished and poverty-vulnerable families from the inflationary effects of this measure,” he said.
According to Gatchalian, the measure is seen to raise electricity rates due to the heavy excise taxes on fuels and minerals.
Excise tax on coal, for instance, would be increased to P300 from P10 per metric ton over the next three years, thereby burdening consumers with P10.5 billion in extra electricity charges, said the energy committee chairman.
“The coal tax, along with the increased excise taxes on diesel and bunker fuel, is poised to make electricity more expensive at a time when the Philippines already has the most expensive electricity rates in the entire ASEAN region,” he said.
“Our estimates indicate that the increases in electricity rates are not negligible,” he added. “These higher rates will be felt by Filipinos.” (ABS-CBN News and Prince Golez/PN)
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