Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

3459

HOUSE BILL No.

Introduced by BAYAN MUNA
Reps. NERI J. COLMENARES and CARLOS ISAGANI T. ZARATE,

AN ACT
AMENDING SECTION 32 (B), CHAPTER VI OF THE NATIONAL INTERNAL
REVENUE CODE OF THE PHILIPPINES (R.A. 8424) THEREBY INCREASING THE,
CEILING OF CHRISTMAS BONUS AND OTHER BENEFITS FROM TAXATION.

EXPLANATORY NOTE

Salaries of most of the public and private employees are generally low comparable to the cost of
living standards set by the government in the country. A report of the National Statistics
Coordination Board (NSCB) pointed out that in 2012:
“a Filipino family of five needed P 5,458 to meet basic food needs every month and Php
7,821 to stay above the poverty threshold (basic food and non-food needs) every month. xxx
The food threshold is the mininuna income required by an individual to meet bis/ ber basic
food needs and satify the nutritional requirements set by the Food and Nutrition Research
Institute (PRI), while remaining economically and socially productive. Put another way, the
food threshold helps measure food poverty or “subsistence,” which may also be described as
extreme poverty.”

“The National Wages and Productivity Commission website shows that the highest minimum wage in
NCR as of October 2013 is P466.00. However, the NCR Family Living Wage (FLW) which,
according to independent think-tank TBON Foundation in its May 2013 study, is already pegged at
1,034 ~ not even half of the government set daily wage.



Wages lag way behind the FLAW because the law only allows one wage increase per year while the
prices of basic commodities from gasoline to food have been shooting up to heights more and more
Filipinos arc not able to cope with. Regions also vary because of so-called differing conditions of
8 are set by Regional Wage Boards, In 2010, the Social Weather Station (SWS)
“mahirap”, But in

living so that wag
‘March survey found 43% or an estimated 8.1 million families rating themselves a
the Thitd Quarter 2013 Social Weather Survey, the number of families who consider themselves
as Mabirap or Poor increased to 50% or an estimated 10.8 million families.

‘This bill seeks to provide Filipinos reprieve from the worsening economic condition in the country
given the labor laws that still need to be reformed to really address the real economic condition of
‘our workers and employees in the country, more than the business companies. It seeks to amend the
National Internal Revenue Code of the Philippines (RA 8424) to INCREASE THE CEILING of
Christmas bonus and other benefits from taxation.

Bonuses and other additional benefits dusing Christmas come only once a year, and in a time whea
prices increase as tradition dictates to bring more food than usual on the table to celebrate the
season. It would mean a lot to the minimum wage earners to be relieved from additional tax burdens
for theit Christmas bonuses and other benefits. For the government employees, the government
might as well give them the full benefit of their bonuses as Christmas gift from the government,

‘The passage of the bill is earnestly sought.

(Ausey wus dee Jace rene

Rep. NERI J. COLMENARES. 1. ZAR.
Bayan Mijua Party-list Bayan Muna Party-lst

Approved,



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

3459

HOUSE BILL No. ——

Introduced by BAYAN MUNA
Reps. NERI J. COLMENARES and CARLOS ISAGANI T, ZARATE,

AN ACT
AMENDING SECTION 32 (B), CHAPTER VI OF THE NATIONAL INTERNAL
REVENUE CODE OF THE PHILIPPINES (R.A. 8424) THEREBY INCREASING THE,
CEILING OF CHRISTMAS BONUS AND OTHER BENEFITS FROM TAXATION.

Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled:

Section 1, Section 32 (B), Chapter VI of the National Internal Revenue Code of the Philippines
(RA No. 8424) is her

y amended as follows:

SEC. 32. Gross Income. =
XXX

ll not be included

(B) Exclusions from Gross Income. - ‘The following items
in gross income and shall be exempt from taxation under this tit

XX

(©) 13" Month Pay and Other Bengfts. - Gross benefits received by officials and
employees of public and private entities: Provided, however, That the total exclusion
under this subparagraph shall not exceed [Thirty thousand pesos (P30,000)] FIFTY
‘THOUSAND PESOS (P50,000) which shall cover:

@ Benefits received by officials and employees of the national and local
government pursuant to Republic Act No. 6686;


(i) Benefits received by employees pursuant to Presidential Decree No. 851, as
amended by Memorandum Order No. 28, dated August 13, 1986,

i) Benefits received by officials and employees not covered by Presidential decree
No. 851, as amended by Memorandum Order No. 28, dated August 13, 1986, and

(iv) Other benefits such as productivity incentives and Christmas bonus
Provided, further, That the ceiling of [Thirty thousand pesos (P30,000)] FIFTY
THOUSAND PESOS (P50,000) may be increased through rules and regulations
issued by the Secretary of Finance, upon recommendation of the Commissioner,
after considering among others, the effect on the same of the inflation rate at the end
of the taxable year,

Section 2. Repealing Clause. — All laws, dectess, resolutions, orders or ordinances or parts thereof
inconsistent with this Act, are hereby repealed, amended or modified accordingly
Section 3, Efectivity. - This law shall take effect after fifteen (15) days following its publication

for two (2) consecutive weeks in the newspaper of general circulation in the Philippines.

Approved.