Metro Manila (CNN Philippines, May 23) — People who pay less than ₱12,800 monthly for rent will have to shell out additional 12% once the comprehensive tax reform bill is passed.
One of the bill’s critics, Bayan Muna Representative Carlos Zarate cited that people whose rents were ₱9,000 per month, for example, would have to pay an additional ₱1,080 per month — or ₱13,000 a year.
This value-added tax is expected to chalk up ₱6 billion from around 400,000 households nationwide.
Although the provision is still pending in Congress, Ways and Means committee Vice Chair Joey Salceda said the panel was open to amending the provision.
“Pwede naman bigyan sila ng direct subsidy or i-retain na lang po ang exemption,” he told CNN Philippines in a phone interview.
[Translation: They can be given direct subsidy, or the exemption can be retained.]
The Bureau of Internal Revenue Regulation No. 16-2011 provides for the tax exemption on lease of residential units with a monthly rent of ₱12,800 and below.
The proposed tax reform had previously been deemed anti-poor by some legislators. Although it aims to lower the income tax, critics say it will only benefit those who have fixed income.
The bill will also increase excise tax on petroleum, automobiles, and sugar-sweetened beverages.
Navotas Rep. Toby Tiangco said the commuting public would eventually carry the burden.
However, Salceda said it was unlikely that the provision on petroleum would be deleted in the bill.
“Petroleum excise tax accounted for 1.79% of (gross domestic product). Right now it’s only 0.09% of GDP. Umiiyak yan para sa hustisya (It’s crying for justice),” Salceda said.
Salceda said subsidy would be given to the poorest of the poor to shield them from the impact of the additional taxes.
Ways and Means committee head Dakila Cua had said an “all-in-one” card would be issued to Conditional Cash Transfer (CCT) program beneficiaries to give discounts for basic commodities, transportation, and even tuition to ease the burden of the additional tax.
