DOF to submit CTRP’s Package 2 to Congress this month
Finance Secretary Carlos Dominguez III said the Department of Finance (DOF) will submit to the Congress this January the second package of the government’s Comprehensive Tax Reform Program (CTRP) after the first package was signed into law by President Rodrigo Duterte last month.
Duterte signed the Tax Reform Acceleration and Inclusion Act (TRAIN) into Republic Act (RA) No. 10963 last Dec. 19 in Malacanang.
Upon signing of the landmark law, the Chief Executive instructed the DOF to ensure its effective implementation and to immediately submit to the Congress in early 2018 the CTRP's Package 2, which aims to lower corporate income taxes and modernize fiscal incentives in a bid to complement the expected incremental revenues from the first package.
“We are very pleased that the legislature passed the TRAIN bill. The President signed it into law although there are some provisions that he vetoed… We are moving forward with the implementation of the tax reform,” Dominguez said during the recent inter-agency Development Budget Coordination Council meeting.
“…We are going to submit to Congress the package two of the CTRP in January 2018,” added Dominguez.
Dominguez said in terms of revenue potential, the Package Two would be neutral.
He said the DOF scored its first major ?legislative victory for the Duterte administration and the Filipino people in 2017 with the approval and signing into law of the TRAIN, which will provide hefty income tax cuts for the majority of Filipino taxpayers while raising additional funds to help support the government’s accelerated spending on its ?“Build, Build, Build” and social services programs.
Dominguez said 99 percent of the country’s population will benefit from the TRAIN, with salaried employees and self-employed individuals earning a taxable income of P250,000 per year, or around P21,000 a month, exempted from paying the personal income tax (PIT). Other taxpayers in higher income brackets will also get to enjoy significant PIT cuts, except the ultra-rich or those earning P8 million a year and above.
Also, 13th month pay and other bonuses amounting to P90,000 a month are non-taxable.
He said the substantial cuts in personal income tax, will, in effect, increase the take-home pay of majority of taxpayers, which will, in turn, boost their disposal income or purchasing power and further stimulate the economy.
Upon signing the TRAIN bill, Duterte said this was just an initial part of the gains under the comprehensive tax reform program as the Congress has passed two-thirds of the expected revenues from Package One of the TRAIN.
The remaining one-third involves provisions on the estate tax amnesty, a general tax amnesty, the proposed adjustments in the Motor Vehicle Users Charge and amendments to the bank secrecy law and automatic exchange of information. DMS