TWENTIETH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
) 
HOUSE OF REPRESENTATIVES 
HOUSE BILL No. ________ 
Introduced by REP. CLAUDINE DIANA D. BAUTISTA-LIM 
AN ACT 
STRENGTHENING 
THE 
PURCHASING 
POWER 
OF 
MIDDLE-INCOME 
TAXPAYERS, AMENDING FOR THE PURPOSE SECTION 24 OF REPUBLIC ACT 
NO. 8424, OTHERWISE KNOWN AS THE NATIONAL INTERNAL REVENUE CODE 
OF 1997, AS AMENDED BY REPUBLIC ACT NO. 10963, OTHERWISE KNOWN AS 
THE TAX REFORM FOR ACCELERATION AND INCLUSION (TRAIN) LAW 
EXPLANATORY NOTE 
Strengthening the purchasing power of taxpayers is a challenge that every 
government faces as it needs to balance economic policy, social equity, and 
governance.  Central to this is the government’s fundamental responsibility to ensure 
that the people’s earnings are enough to afford them a better quality of life. 
Article VI, Section 28 of the 1987 Philippine Constitution states that the rule of 
taxation shall be uniform and equitable and that Congress shall evolve a progressive 
system of taxation.  This provision sets out the principle that a sound tax system must 
be founded on the taxpayer's ability to pay. 
The enactment of the TRAIN Law which amended the National Internal 
Revenue Code (NIRC) has significantly reformed the personal income tax system by 
restructuring tax brackets, increasing the exemption threshold, and imposing higher 
rates on top earners. While these reforms have eased the tax burden for many 
employed individuals, they have also placed an excessive burden on high-income 
earners1.  Middle income earners are particularly jeopardized because they are often 
underserved in social protection programs despite being equally vulnerable to financial 
instability. 
1 Barua Yap, D. J. E. Jr., PhD, Udaundo, E., & Santos, J. (n.d.). Progressivity, Fairness, and Efficiency: An 
evaluation of the impact of the TRAIN Law on the distribution of the income tax burden. 
In https://cpbrd.congress.gov.ph/wp-content/uploads/2025/03/PB2025-04-IMPACT-OF-THE-TRAIN-LAW-
1.pdf (No. 2025-04).
August 4, 2025
4:55 pm
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This measure seeks to amend existing tax laws levied on personal tax income 
to reduce the tax burden on middle-income earners.  Through this measure, the 
bracket of personal income tax exemption shall be increased from PHP250,000 to 
PHP600,000.  By expanding the personal income tax exemption threshold, the tax 
system is projected to become more equitable, responsive to inflation, and supportive 
of inclusive growth. Adjusting the tax bracket will reflect economic reality and 
safeguard not only those who are earning minimum wage but also the middle-income 
earners. 
Less taxes collected from middle income individuals will increase their 
disposable income which in turn will boost consumer spending, thus creating greater 
demand for goods and services, and generate a ripple effect in economic activities.  
As living costs rise, stagnant tax brackets can erode real income.  Adjusting the 
personal income tax threshold ensures that taxpayers are not pushed into higher tax 
rates simply due to inflation, preserving their ability to afford essentials. 
In view of the foregoing, immediate approval of this bill is earnestly sought. 
REP. CLAUDINE DIANA BAUTISTA-LIM 
    DUMPER PTDA Party-List 


TWENTIETH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
) 
HOUSE OF REPRESENTATIVES 
HOUSE BILL No. ________ 
Introduced by REP. CLAUDINE DIANA D. BAUTISTA-LIM 
AN ACT 
STRENGTHENING 
THE 
PURCHASING 
POWER 
OF 
MIDDLE-INCOME 
TAXPAYERS, AMENDING FOR THE PURPOSE SECTION 24 OF REPUBLIC ACT 
NO. 8424, OTHERWISE KNOWN AS THE NATIONAL INTERNAL REVENUE CODE 
OF 1997, AS AMENDED BY REPUBLIC ACT NO. 10963, OTHERWISE KNOWN AS 
THE TAX REFORM FOR ACCELERATION AND INCLUSION (TRAIN) LAW 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
Section 1. Amendment of Section 24 of Republic Act No. 8424. – Section 24 of 
Republic Act No. 8424, otherwise known as the “National Internal Revenue Code of 
1997, as amended, is hereby further amended to read as follows:  
"SEC. 24. INCOME TAX RATES. - 
"XXX 
"TAX SCHEDULE EFFECTIVE JANUARY 1, 2026 AND ONWARDS: 
"NOT OVER ₱600,000 
0% 
"OVER ₱600,000 BUT NOT 
OVER ₱800,000 
₱22,500 + 20% OF THE EXCESS 
OVER ₱600,000 
“XXX 
Sec. 2. Repealing Clause. – All other laws, rules and regulations, orders, 
circulars, and other issuances or parts thereof, which are inconsistent with the 
provisions of this Act are hereby repealed, modified or amended accordingly.  
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Sec. 3. Separability Clause. – If for any reason any section or provision of this 
Act is declared invalid or unconstitutional, other provisions hereof which are not 
affected thereby shall continue to be in full force and effect.  
 
Sec. 4. Effectivity. – This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in at least two (2) newspapers of general 
circulation in the Philippines.  
 
Approved,