13th month, OT pay must be tax-free – Mayor Abby Binay
Makati City Mayor Abby Binay (FILE PHOTO0
MANILA, Philippines — The overtime and 13th-month pay of private and public sector workers should be free from tax, according to
Binay, in a statement on Thursday, said she would push for the tax exemptions, aiming to “bring relief to workers and their families in the form of disposable income for their basic needs.”
“Relieving the tax burden on workers will enable Filipino families, especially those in the low to middle-income sectors, to avoid falling deeper into poverty in the face of rising inflation,” she said.
“May domino effect yan. Tataas ang consumer spending, sisigla ang mga negosyo, tataas ang revenue collection ng gobyerno. Na-offset whatever revenue is lost,” Binay added.
(It will have a domino effect. Increased consumer spending will drive sales and accelerate business growth, which will translate to higher revenue collection for the government. Whatever revenue is lost will be offset.)
Article continues after this advertisementThe current Tax Code places a cap of P90,000 for the total amount of the 13th month pay and other additional benefits, including 14th month and performance bonus, to be considered non-taxable income.
Article continues after this advertisementAny amount in excess of P90,000 shall form part of the taxable income of employees.
