MANILA, Philippines – Filipino workers will now enjoy a P10,000 (US$223.8) tax exemption on benefits they receive starting January 2015.
According to Department of Labor and Employment (DOLE) Secretary Rosalinda Baldoz and Finance Secretary Cesar Purisima, President Benigno Aquino III approved a revenue regulation on tax exemptions, under the collective bargaining agreement and productivity incentive schemes.
“According to Secretary Purisima, the increase in tax exemption for those referred to as ‘de minimis’ benefits is just, due to the millions and millions of workers this will benefit,” Communications Secretary Sonny Coloma said on Sunday, December 28.
In a dialogue with labor groups early this year, President Benigno Aquino III raised concerns over the legality of workers’ demands for tax breaks. Labor groups wanted the BIR to exempt "de minimis" or fringe benefits from tax, and impose taxes only on the incremental amount of the negotiated minimum wage for regular workers.
On May 1, Labor Day, Nagkaisa – the biggest alliance of labor groups and workers' organizations in the country – staged a march to air their demands from government, which again included tax breaks.
Malacañang said that this approval was a product of Aquino’s discussions with workers over the past year.
It is estimated that up to P104,225 ($2,333) worth of total benefits will be tax-exempt compared to the current P94,225 ($2,109). About P17 billion ($380.5 million) worth of taxes will not be collected by the Bureau of Internal Revenue due to the increase in benefits. –Rappler.com
