The House Committee on Ways and Means on Monday approved measures that would raise the annual taxable income exemption ceiling to P350,000 from P250,000 and exempt microenterprises from the 2-percent Minimum Corporate Income Tax (MCIT).
The measures form part of a broader tax reform package aimed at providing relief to individual taxpayers and small businesses while maintaining the government’s capacity to fund public programs and services.
House Bills Nos. 10345 and 10346, introduced by Speaker Faustino “Bojie” Dy III and Majority Leader Ferdinand Alexander “Sandro” Marcos, were approved by the committee, subject to style.
The hearing was presided over by Marikina 2nd District Rep. Miro Quimbo, chairperson of the Ways and Means Committee.
Under House Bill No. 10345, individuals earning up to P350,000 annually would be exempt from personal income tax.
The proposal seeks to amend Section 24 of the National Internal Revenue Code by restructuring the graduated income tax rates imposed on individual taxpayers.
The proposed increase would raise the current annual income tax exemption ceiling from P250,000 to P350,000, potentially giving additional take-home pay to low- and middle-income workers covered by the measure.
Quimbo said the proposed adjustment is part of the committee’s effort to recalibrate the tax system in response to the financial pressures faced by Filipino families and workers.
The committee also approved House Bill No. 10346, which seeks to provide tax relief to microenterprises by exempting them from the 2-percent MCIT.
The measure recognizes the impact of the MCIT on small businesses operating with limited margins and recovering from economic disruptions.
Quimbo said the proposed exemption is intended to give entrepreneurs more room to sustain and expand their businesses.
“The objective is not simply to reduce taxes. It is to create breathing room for entrepreneurs and businesses so they can spend, invest, hire, and grow,” he said.
The committee may consolidate the two proposed tax relief measures with corresponding revenue measures into a single omnibus tax reform package, Quimbo said.
He stressed that any reduction in government revenues resulting from the proposed exemptions must be matched with measures that will maintain fiscal sustainability.
The approval by the Ways and Means Committee allows the proposed measures to move forward in the legislative process, where their provisions and potential revenue implications will continue to be considered.
Photo courtesy of PH Congress
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