DOF, BIR mull tax benefits for Pinoys 

Workers in the private and public sectors can expect less tax burden as the Department of Finance (DOF) and the Bureau of Internal Revenue (BIR) are proposing higher ceilings for tax-exempt benefits.

The DOF and BIR announced this on Saturday after President Marcos said that “every Filipino worker deserves to benefit from the nation’s growth.” The President said so before he left for Malaysia to attend the 47th Association of Southeast Asian Nations Summit and Related Summits.

Finance Secretary Ralph Recto said that if the proposal were realized, households would enjoy some relief from their daily expenses as workers would be able to bring home more of their earnings.

“These increases will have minimal impact on the government revenues but will definitely make a significant difference for our workers,” Recto said.

Under the proposal, employees in both private and government service will enjoy higher nontaxable allowances and benefits. This is intended to account for inflation and rising living costs. It is also meant to enhance competitiveness across sectors while maintaining prudent fiscal management on the part of the government.

For example, the tax-exempt ceiling for monetized unused vacation leave credits for private employees will be increased from 10 to 12 days.

However, the current uncapped benefit for government employees’ monetized vacation and sick leave will be retained.

Meanwhile, the limit for medical cash allowances for dependents will also be adjusted from P1,500 to P2,000 per half-year.

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Also, rice subsidies will go up from P2,000 to P2,500 per month or its market equivalent.

Further, the nontaxable threshold for uniform and clothing allowance will increase from P7,000 to P8,000 per year.

The DOF and the BIR are also proposing increases in the maximum amount of certain benefits. For example, they want to raise medical assistance from P10,000 to P12,000 per year and the laundry allowance from P300 to P400 per month.

The two agencies also want to raise employee achievement awards from P10,000 to P12,000 per year and Christmas or anniversary gifts from P5,000 to P6,000 per year.