File photo.
“On taxation, my administration will pursue tax reforms towards a simpler and more equitable and more efficient tax system that can foster investment and job creation. We will lower personal and corporate income tax rates. At the household level, there must be sufficient income for all Filipinos to meet the basic and non-food needs for their families,” President Rodrigo Duterte said in his State of the Nation Address last Monday.
25-year old call center agent Angeline Manalili felt relieved after hearing Pres. Rodrigo Duterte’s promise of lowering the income tax.
She says despite receiveing reasonable income in her eight years in the call center industry, she still cannot manage to save money.
“It’s annoying because you worked hard for it. Then, you see the amount of your tax that is so big and you dont know where it goes,” Manalili expressed.
Angeline is just one of the employees who are hoping for a tax reform. While the prices of basic commodities continue to rise through the years, the system of high tax rate remains, leaving families like those of Angeline in struggle for sustenance.
“Maybe if my salary gets higher, my husband and I, then we will be able to save,” said Manalili.
In the current taxation system, those earning 400, 000 each year or at least 30, 000 pesos per month incur 30% tax annually.
This totals to seven to eight thousand pesos each month.
The Bureau of Internal Revenue (BIR) has not yet affirmed if tax reform will be expected soon.
But according to tax lawyer, Atty. Rosario Bernaldo, lowering of income tax is possible under the Duterte administration, saying many have expressed support to it.
She says those earning between 300 to 500 thousand pesos each year should be exempted from paying tax.
She also proposes that tax rate should be reduced to 25% from 32% at least for those receiving more than 500 thousand pesos each year.
“As employee, you are paying huge amount of taxes. You have no choice because the employer has to withhold. If tax will be lowered, the net pay will be increased,” Atty. Bernaldo said.
Atty. Bernaldo believes lowering of income tax will not result in budget deficit in the government.
It’s just a matter making sure everybody pays the right taxes.
“I am thinking that our local, our grassroots, for example the local government units up to the barangay level, they are the ones who see businesses and they can report if there are unregistered tax payers around,” Atty. Bernaldo added.
The government can also give out amnesty to those who did not pay the right taxes during the previous years.
Through this, payers volunteer to declare their unpaid taxes and in return, the government will require only minimal payment.
The speeding up of government processes, filing of income tax return, among others, will also encourage proper payment of taxes.
This will also attract investments and businesses in the country since requirements will be easier to process.
(JOYCE BALANCIO/UNTV NEWS & RESCUE)
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