Senate Bill Filed To Raise Income Tax Exemption To ₱350k

​SEN. Francis Pangilinan has filed Senate Bill (SB) 2344 that seeks to raise the annual income tax exemption threshold from P250,000 to P350,000.

​Filed on July 28, it aims to amend Section 24 of the National Internal Revenue Code of 1997 to allow wage earners to keep a larger portion of their income.

​This comes after President Ferdinand Marcos Jr. called on Congress to increase personal income tax exemptions to ease the financial burden on Filipino families in his fifth State of the Nation Address (SONA).

​Pangilinan said inflation has steadily eroded the purchasing power of workers, while salaries have largely failed to keep pace with rising prices.

​“Filipinos have not yet returned to their homes; their income for the day has run out because of taxes. The P1,000, they say, when given in cash, is like a breath of wind. It’s gone now,” Pangilinan said.

​“Is it a luxury to increase people’s take-home pay? Let’s just increase their take-home pay a little so that we can buy dinner or buy maintenance for high blood pressure, and what is happening here is really high blood pressure,” he added.

​Under the measure, the first P350,000 of annual taxable income will be exempt from personal income tax, up from the current P250,000 threshold set under the Tax Reform for Acceleration and Inclusion (Train) Law. The exemption will also apply to self-employed individuals and professionals who opt for the 8 percent tax on gross sales or receipts and other non-operating income.

​The bill proposes to adjust the income thresholds for higher tax brackets, setting the 15 percent rate at incomes exceeding P350,000 but not over P500,000, the 20 percent rate at over P500,000 but not exceeding P1 million, the 25 percent rate at over P1 million but not exceeding P2.5 million, and the 30 percent rate at over P2.5 million but not exceeding P8 million.

​Pangilinan said the proposed adjustments are meant to reflect present-day economic realities and ensure that tax policies remain responsive to the needs of ordinary Filipino households.

​“The change in the size or smallness of business income is riding on the economic ups and downs. But the taxes on workers are stuck. Crisis or not, the cuts are permanent. Our taxpayers need a little help, especially when life is hard,” he said.

​Meanwhile, Sen. Bong Go has filed SB 2329 that seeks to extend the estate tax amnesty period until Dec. 31, 2028.

​It aims to amend RA 11213, or the Tax Amnesty Act. The bill mandates the expansion of the coverage of the amnesty to estates of individuals who died on or before Dec. 31, 2024, provided the corresponding estate taxes remain unpaid or have accrued as of the same date.

​The current law covers estates of decedents who died on or before May 31, 2022.

​“Many families have difficulty settling their inherited property due to the expense and complicated process. This bill aims to give them more time and an easier way to settle their obligations,” Go said.

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