f
NINETEENTH CONGi-^ESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
♦rT,iU. 
''LT TiiDft rr of the
72 JUL19 P6--40
SENATE
S. B. No. 771
Rl'CE!'. a'j S’-
Introduced by Senator SONNY ANGARA
AN ACT
AMENDING SECTIONS 5 AND 8 OF REPUBLIC ACT NO. 9505, OTHERWISE 
KNOWN AS THE PERSONAL EQUITY AND RETIREMENT ACCOUNT (PERA) 
LAW AND FOR OTHER PURPOSES
EXPLANATORY NOTE
Republic Act No. 9505 or the Personal Equity and Retirement Account (PERA) 
Act was signed into law in 2008. This law, which my father and I worked on during 
the 14th Congress, establishes a framework wherein banks offer long-term savings 
plans coupled with, sound investment options that enjoy tax incentives—all designed 
to help Filipinos achieve a comfortable and financially secure retirement.
The scheme seeks to encourage Filipinos to save and prepare for their 
retirement by giving PERA holders several tax incentives, including an income tax 
credit equivalent to five percent (5%) of the total PERA contribution and tax- 
exemption of investment earnings from PERA savings. A private employer may also 
contribute to its employee's PERA to the extent of the amount allowable and such 
contribution shall be allowed as deduction from the employer's gross income.
The PERA law was envisioned to provide Filipinos an alternative option for 
their retirement plans other than the ones available under the Government Service 
Insurance System (GSIS), the Social Security System (SSS) or the Pag-IBIG Fund. 
However, despite being passed more than a decade ago, the PERA law was formally 
launched by the Bangko Sentra! ng Pilipinas {BSP) only on December 16, 2016.
While PERA's launching is a welcome development, more Filipinos need to be 
enticed into saving and investing into their future. According to the BSP's 2022
V-:1 V i >
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Consumer Expectations Survey, while there are more households with savings 
compared to the last quarter of 2021, it noted that almost half or 45 percent of 
these households kept their savings at home. These households stated that their 
savings are for emergencies, health and medical expenses, retirement, education, 
and business capte l and investment. It is a must that Filipinos place their hard- 
earned finances in secure banks or financial institutions including proper investment 
vehicles.
Hence, this proposed bill aims to make PERA more attractive by increasing the 
maximum allowed annual contributions entitled to tax incentives from P100,000 to 
P200,000 (up to P400,000 for Overseas Filipino Workers (OFWs). Instead of a five- 
percent (5%) income tax credit, this bill proposes to treat PERA contributions as 
deductions from gross income. Hopefully, with such changes, more Filipinos would 
be encouraged to invest in PERA, which will not only foster savings but also promote 
capital market development-two crucial factors in sustaining our economic growth.
In view of the foregoing, the passage of this bill is earnestly sought.
SOdMNY ANGARA


--•rn"
I'* >)K' ■ ■ i;
NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
72 JUL 19 P6 ^0
SENATE
S. B. No. 771
RECS. - ■
Introduced by Senator SONNY ANGARA
AN ACT
AMENDING SECTIONS 5 AND 8 OF REPUBLIC ACT NO. 9505, OTHERWISE 
KNOWN AS THE PERSONAL EQUITY AND RETIREMENT ACCOUNT (PERA) 
LAW AND FOR OTHER PURPOSES
Be it enacted ty the Senate and the House of Representatives of the Philippines in 
Congress assembled:
1 
SECTION 1. Section 5 of Republic Act No. 9505 is hereby annended to read
2 
as follows:
3 
"Sec. 5. Maximum Annual PERA Contributions. - A Contributor may
4 
make an aggregate maximum contribution of [Gee] TWO hundred
5 
thousand pesos [(PlOQ.OQO.OO)] (P200/000.00) or its equivalent in
6 
any convertible foreign currency at the prevailing rate at the time of
7 
the actual contribution, to his/her PERA per year: Provided, That if the
8 
Contributor is married, each of the spouses shall be entitled to make a
9 
maximum contribution of [Or^e] TWO hundred thousand pesos
10 
[yiOO-,000.00)] (P200,000.00) or its equivalent in any convertible
11 
foreign currency per year to his/her respective PERA Provided, further,
12 
That if the Contributor is an overseas Filipino, he shall be allowed to
13 
make maximum contributions double the allowable maximum amount.
14 
A Contributor has the option to contribute more than the
15 
maximum amount prescribed herein: Provided, That the excess shall
16 
no longer be [cntitlea to a tr.x credit-of-five-pc rc-ent-{ 5'%)] ALLOWED


1 
AS DEDUCTION FROM GROSS INCOME, AS PROVIDED IN
2 
SECTION 8 OF THIS ACT.
3 
The Secretary of Finance may adjust the maximum contribution
4 
from time to time, taking into consideration ^he present value of the
5 
said maximum contribution using the Consumer Price Index as
6 
published by the [National—Statistics—Offic-e] PHILIPPINE
7 
STATISTICS AUTHORITY, fiscal position of the government and
8 
other pertinent factors."
9 
SEC. 2. Sec.ion 8 of Republic Act No. 9505 is hereby amended to read as
10 
follows:
11 
"Sec. 8. Tax Treatment of Contributions. - [The Gentributor shall-be
12 
given-afHneemc tax credit-equivalent to five-per-eent (-S^j--ef the total
13 
PERA contnb ition: Pfxmded--^ howovcry T\:\^t-\:\ no ■in'3tancQ-can--there
14 
be any refund of the- said—tax—eredit arising from the PERA
15 
contributions. If the Contributor-is-an- overseas-Filipino-, he.shall-be
16 
entitled—te-elaim-tax—credit---from any tax payable to the national
17 
gevemment-under-the National Internal Revenue-Gede-of 1097, -as
18 
amendedr] FOR INCOME TAX PURPOSES, PERA
19 
CONTRIBUTIONS UP TO THE MAXIMUM AMOUNT PRESCRIBED
20 
IN SECTION 5 OF THIS ACT SHALL BE ALLOWED AS
21 
DEDUCTIONS FROM GROSS INCOME OF EACH CONTRIBUTOR:
22 
PROVIL ED, HOWEVER, T MAT ANY EXCE3S IN THE MAXIMUM
23 
AMOUNT SHALL NO LONGER BE ALLOWED AS DEDUCTIONS
24 
THEREOF.
25 
SEC. 3. Implementing Rules and Regulations. - The Bureau of Internal
26 
Revenue (BIR) shall issue the implementing rules and regulations regarding all
27 
aspects of tax administration relating to PERA; Provided, That individuals earning
28 
purely compensation income, as defined in Section 32 (A)(1) of the National Internal
29 
Revenue Code (NIRC), as amended, derived from sources within the Philippines, the
30 
income tax on which has been correctly withheld under the provisions of Section 79
31 
of the NIRC, a:- amended, and will oe a Contributor to a PERA are still not required
32 
to file an income tax return but are subject to substituted filing: Provided further,


1 
That the BIR shall issue the necessary rules and regulations in relation to this matter
2 
such that correct taxes are withheld and/or collected: Provided finally, That the
3 
failure of the concerned agencies to promulgate the said rules and regulations shall
4 
not prevent the imp ementation of this Act upon its eifectivity,
5 
SEC. 4. Separability Clause, - If any portion or provision of this Act is
6 
subsequently declared invalid or unconstitutional, other provisions hereof which are
7 
not affected thereby shall remain in full force and effect.
8 
SEC. 5. Repealing Clause. - All other laws, acts, presidential decrees,
9 
executive orders, presidential proclamations, issuances, rules and regulations, or
10 
parts thereof which are contrary to or inconsistent with any of the provisions of this
11 
Act are hereby repealed, amended, or modified accordingly.
12 
SEC. 6. Effectivity. - This Act shall take effect fifteen (15) days after its
13 
publication in tt a Official Gazette or in a newspaper of general circulation.
Approved,