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Philippines' Senate Approves Latest Tax Reform Package

by Mary Swire, Tax-News.com, Hong Kong

04 December 2017


The Philippines' Senate on November 28 approved its version of the Tax Reform for Acceleration and Inclusion (TRAIN) bill, which is expected to exempt 6.8 million workers from paying income taxes.

Senate Bill 1592, sponsored by Senator Sonny Angara, Chairman of the Ways and Means Committee, was approved on third and final reading with 17 affirmative votes and one negative vote.

The passage of the TRAIN bill has been identified by leadership in both houses of Congress and the Duterte administration as a priority. The Senate version consolidated 31 Senate bills, three House bills, and three Senate resolutions.

Under the Senate-approved SB 1592, the first PHP250,000 (USD4,930) of annual taxable income will be exempted from tax, and a PHP82,000 tax exemption for 13th month pay and other bonuses will be introduced. The bill will also expand the value-added tax base, specifically by removing exemptions for cooperatives, low-cost housing, renewable energy, and for senior citizens except for medicine.

An amendment to the bill, which was passed by a significant majority, proposes to hike the coal tax from PHP10 per metric ton to PHP300 per metric ton. Senator Joel Villanueva, who sponsored the amendment, noted that coal tax rates had not been amended since 1988. In respect of the mining sector, the Senate also approved to increase the excise taxes on metallic and non-metallic mining resources from two percent to four percent.

TAGS: tax | value added tax (VAT) | mining | energy | Philippines | tax rates | individual income tax | Tax

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