Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

SIXTEENTH CONGRESS
Second Regular Session

House Bitno,_4974

Introduced by Honorable MARK A. VILLAR

AN ACT
AMENDING SECTION 24 OF THE NATIONAL INTERNAL REVENUE CODE
OF 1997, AS AMENDED, AND FOR OTHER PURPOSES

EXPLANATORY NOTE

Filipinos have been assessed income taxes on their individual taxable earnings
way too high than what most of their Asian counterparts have been paying

In a report, an analysis of tax policies in the ASEAN suggests that the Philippines
has the second highest average tax rate (after Vietnam and Thailand). On the other
hand, Singapore has the lowest marginal tax rate at both ends of its tax bracket
spectrum, at 20% for the wealthiest and 2% for the lowest qualifying income tax payers
(Compare this with 32% and 5% for the Philippines. )'

More importantly, the steady rise of prices of goods and services makes it hard
for Filipinos to meet the demands of daily living. The rise in commodity prices has
clearly weakened the purchasing power of our people's hard-earned money.

Income-earning Filipinos not only have to contend with the weakening effects of
inflation but also with the huge tax in their salaries.

“http:/Awww.rappler.com/thought-leaders/651 14-filipino-middle-class-over-taxed


To ease the tax burden of our Filipino workers, and for our country to be at par
with regional standards and to “make the Philippine workforce more competitive with its
neighbors,” this bill seeks to amend Section 24 of the National intemal Revenue Code
of 1997, as amended, by adjusting the individual income tax brackets and reducing the
rates of individual income tax

After more than a decade without an amendment to the individual income tax,
this is an opportune time to pass a law reducing the said taxes

In view of the foregoing reasons, the immediate enactment of this bill is earnestly
sought.

Ve 7#/-——

MARK A. VILLAR


a

Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

SIXTEENTH CONGRESS
Second Regular Session

House Bit no,_4974

Introduced by Honorable MARK A. VILLAR

AN ACT

AMENDING SECTION 24 OF THE NATIONAL INTERNAL REVENUE CODE
OF 1997, AS AMENDED, AND FOR OTHER PURPOSES.

Be it enacted by the Senate and the House of Representatives of the. Philippines in

Congress assembled:

SECTION 1. Section 24(A) (2) of the National intemal Revenue Code of 1997, as

amended, is hereby further amended to read as follows:

"Sec, 24, Income Tax Rates —

"(A) Rates of Income Tax on Individual Citizen and Individual Resident Alien of the

Philippines.—

(2) Rates of Tax on Taxable Income of Individuals, - The tax shall be computed in

accordance with and at the rates established in the following schedule

Beginning
January 1, 2015 | January 1, 2016
P20,000 but not overP70,000 | 15% | 13%

Taxable Income

‘Over P70,000 but not over | P10,500 + 20% of | P9,100 18% of
200,000 | the excess over | the excess over
|P70,000 ——_—_—| P70,000_

“| Beginning Beginning

January 1, 2017 |
Ll ea
7,000 + 15%
of the excess
over P70,000



Over P200,000 but not over | P36,500 + 25% of | P32,500+ 23% | P26,500+ 20% |
500,000 the excess over | of the excess __| of the excess
_ _ 200,000 ‘over P200,000_| over P200,000
Over P500,000 but not over | P117,500 + 30% | P101,500 + P86,500 + 22%
1,000,000 of the excess over | 25% of the of the excess
P500,000 excess over —_| over P500,000
— _ - - 500,000
Over P1,000,000 P261,500 + 32% | P226,500 + P196,500 +
of the excess over | 28% of the 25% of the
| P1,000,000 excess over _| excess over
7 _ _ 1,000,000 __| P1,000,000
[Not over P10,000...... 5%
‘Over P10,000 but not over P30,000. P500+10% of the excess over P10,000
‘Over P30,000 but not over P70,000.....  P2,500+15% of the excess over P30,000
‘Over P70,000 but not over P140,000. P8,500+20% of the excess over P70,000

Over P140,000 but not over P250,000.. _ P22,500+25% of the excess over P140,000

Over P250,000 but not over P500,000. _ P50,000+30% of the excess over P250,000

Over P500,000 P125,000+34% of the excess over
500,000 in 1998.]

XXX
XXX

SEC 2Implementing Rules and Regulations. - The Secretary of Finance shall
promulgate the necessary rules and regulations for the effective implementation of the
provisions of this Act.

SEC 3.Repealing Clause. - All laws, orders, issuances, circulars, rules and regulations
or parts thereof, which are inconsistent with the provisions of this Act are hereby repealed or
modified accordingly.

SEC 4.Separability Clause.

invalid, other parts or provisions hereof not a
effect

- If any provision of this Act is declared unconstitutional or
ft fected thereby shall continue to be in full force and

SEC 5.Effectivity. - This Act shall take effect on January 1.2016 following its publication
in at least two (2) newspapers of general circulation.

Approved,