Metro Manila, Philippines – House Speaker Faustino “Bojie” Dy III and House Majority Leader Sandro Marcos on Tuesday filed a bill seeking to raise the annual tax-free income ceiling from ₱250,000 to ₱350,000.
The filing followed President Ferdinand Marcos Jr.’s proposal during his fifth State of the Nation Address (SONA).
House Bill No. 10345 seeks to amend the National Internal Revenue Code by restructuring the country’s graduated income tax rates.
The measure would increase the tax-free income threshold by ₱100,000, exempting annual taxable income of up to ₱350,000 from income tax.
Under the proposal, taxable income above ₱350,000 but not exceeding ₱400,000 would be subject to a 15% income tax, while the existing graduated rates for higher income brackets would remain in place.
Minimum wage earners would continue to be exempt from income tax, including on their holiday pay, overtime pay, night shift differential pay, and hazard pay.
The bill also retains the option for qualified self-employed individuals and professionals to avail of the 8% tax on gross sales, receipts, and non-operating income beyond the proposed ₱350,000 threshold, subject to existing rules.
If enacted, the Department of Finance, upon the recommendation of the Bureau of Internal Revenue, will issue the implementing rules and regulations within 90 days, while the law will take effect 15 days after its complete publication.
