By Azer N. Parrocha
MANILA, Dec 9 (PNA) — A measure was filed in the Senate on Monday seeking to increase the limit on the amount of 13th month pay, Christmas bonus and other benefits exempted from income tax.
Senate President Pro-Tempore Ralph Recto, who filed the measure, said that he wanted the exclusion raised to P75,000 since the present ceiling was set by a law enacted almost 20 years ago.
According to Recto, present laws exclude the mandated 13th month pay and the Christmas bonus from the coverage of income taxes, but only up to the extent of P30,000.
He said that any amount in excess forms part of an individual’s gross income and therefore subject to the operation of the National Internal Revenue Code.
“We owe it to the people to amend laws that tend to be more repressive rather than be beneficial to the people,” Recto said in a statement.
“In this bill, we intend to breathe life again to the spirit of the law that, during the time of its passage, intended to allow the people to enjoy more of their hard-earned money,” he added.
Recto explained that the measure also provides that the ceiling of P75,000 will be adjusted to its present value using the Consumer Price Index (CPI) as published by the National Statistics Office (NSO).
This was published three years after the measure’s enactment and every three years thereafter, he noted.
“It is of paramount importance that our laws be responsive to the needs of the people,” Recto said.
“An increase in the ceiling of the 13th month pay and other benefits to be exempted from income tax is one of the reliefs the people need during these hard times,” he added.
The senator further said that if passed into law, the increase in the tax exemption ceiling would translate to a higher take home pay for employees in the private and government sectors alike.
This will be translated particularly during the Christmas season, when the 13th month pay and other bonuses are usually released. (PNA)