Top Gear Philippines posted the new 2018 price list of the Toyota cars line-up, after the effectivity of the TRAIN (Tax Reform for Acceleration and Inclusion) law. Yes, as expected, expensive and/or luxury cars either retained or even decreased their selling prices. But the more interesting observation is how pick-up trucks, i.e., the Hilux lineup, saw decreased prices as well, regardless of the original price.
I still can’t surmise why pick-ups have to benefit from this law? Please, someone, explain it to me.
At long last, the BIR has issued the final IRR (Implementing Rules and Regulations) of Republic Act No. 9504, an Act Amending Sections 22, 24, 34,35, 51 and 79 of Republic Act no. 8424. It’a available for download from the BIR website. Thanks to Nora for the heads up.
For sure, a lot of people who have long been waiting for this release will deluge in the website and may bring their server down. I already downloaded a copy (including annexes) and compiled them myself.
It’ll be available for download here.
There are pertinent articles regarding RA 9504 over at Punongbayan & Araullo’s Press Room. They describe the issues surrounding the law.
You can read the articles here, here, and here.
Many concerns have been raised, and my favorite:
Is this really what RA 9504 intended — to create and encourage absurd situations? Can’t the BIR, at least, read the real intent of RA 9504 and help promote social justice by saying that any income received by a worker over and above the minimum wage, to the extent that the tax distortion is eliminated and the take home pay is equalized, be still exempt from taxes as a MWE?
It may be difficult to justify such move, considering that the flaw is in the law itself. But the BIR was able to do it in certain instances in the past.
With these good, pertinent, and timely articles from an accounting firm website, P&A would have better hosted a discussion by offering comments or provided a forum. It would have been a good discussion, instead of just a lone standing article.
Disclaimer: The article that follow is my personal opinion, intended for discussion purposes only. It should not be construed as official opinion or regulation by any governmental agency that has authority over the matter.
Found this in my inbox:
Can you help me understand what is the maximum amount of de minimis that could be extended to employees? What are other tax deductions can an employee have?
The National Internal Revenue Code of 1997 only mentions of De Minimis Benefits as one of the fringe benefits that are not taxable (Section 33.C). No definition whatsoever. As such, no explicit amount was provided for in the law.
An Act Amending Sections 22, 24, 34,35, 51 and 79 of Republic Act no. 8424, as amended, otherwise known as The National Internal Revenue Code of 1997
Looking at the stats of this site, I’m sure many are already looking for a copy of the law. I have good and bad news: the good news–I have a copy of the law; the bad–I have a bad copy.
Download: RA-9504 pdf (440kb)
As expected, there were no changes in the progressive tax table. Our lawmakers and our President sure have gained credits for themselves for passing the bill into law. But it only did affect the personal exemptions allowed for most of us taxpayers. Only a part of the taxable income was adjusted, not the whole.
Come to think of it, rice in 1997 was (at the maximum, maybe) P20 per kilo. Now, how much is it? You can answer that question. That’s basically how inflation has gone up since 1997, when the original law (RA 8424) was enacted.
According to this news, the approval of the tax exemption bill that’s been pending in the Senate was rushed. I say this has long been overdue.
MANILA, Philippines — With three weeks left before Congress goes into recess, the Senate is rushing the approval of a long-awaited measure that seeks to exempt minimum wage earners from paying the income tax.
But with the inflation since 1997, the brackets in the progressive tax table definitely needs as much adjustment as the personal exemption. Otherwise, it would just be like saving the lowly taxpayers a meal a day when they eat three times a day.
Republic Act 8424 (Philippine Law), otherwise known as the Tax Reform Act of 1997 or the Revised National Internal Revenue Code (NIRC) of 1997, which became effective in 1998, is already more than a decade old law. It’s basically a comprehensive law that covers all national taxes from income tax for individuals and corporations, estate and donor’s tax, value added tax, other percentage taxes, excise tax on certain goods, and documentary stamp taxes.
The law is old enough that, as a matter of fact, certain provisions have already been revised just like the income tax for corporations and the Expanded Value Added Tax. What marvels me is why there’s no change, or at least any proposed changes underway (none that I heard of), in income tax for individuals.