MANILA – Senator Francis Pangilinan has filed a bill seeking to raise the annual personal income tax exemption threshold from PHP250,000 to PHP350,000, in line with President Ferdinand R. Marcos Jr.'s call during his fifth State of the Nation Address (SONA) to increase the tax-exempt income threshold.
Filed on Tuesday, a day after Marcos delivered his penultimate SONA, Senate Bill No. 2344 proposes amendments to Section 24 of the National Internal Revenue Code of 1997 by exempting the first PHP350,000 of annual taxable income from personal income tax.
The measure also seeks to extend the higher exemption threshold to self-employed individuals and professionals who opt for the 8-percent gross receipts tax regime.
Pangilinan said the proposal seeks to update the country's income tax exemption to better reflect current economic conditions and help ordinary workers retain a larger portion of their income for basic household needs, including food, transportation, education, healthcare and utilities.
He noted that inflation has steadily eroded the purchasing power of Filipino families while wage earners continue to face increasing financial pressures despite stagnant incomes.
“Hindi pa nakakauwi ang mga Pilipino sa mga bahay nila, ubos na ang kinita nila sa araw na yun dahil sa tax. Ang PHP1,000, sabi nga nila, kapag nabaryahan, aba parang hinipan lang ng hangin. Wala na agad (Filipinos have yet to reach their homes and yet their income for the day is already gone because of tax. They say PHP1,000 these days don't last long),” Pangilinan said in a statement Friday.
If enacted, the bill would also adjust the income thresholds for higher tax brackets. The proposed thresholds are PHP500,000 for the 15-percent tax rate, PHP1 million for the 20-percent rate, PHP2.5 million for the 25-percent rate, and PHP8 million for the 30-percent rate.
A similar proposal was filed by Senator Bam Aquino last year.
Aquino's Senate Bill No. 267, filed on July 8, 2025, seeks to raise the annual income tax exemption threshold from PHP250,000 to PHP480,000 by amending the National Internal Revenue Code.
The bill also aims to exempt individuals earning up to PHP480,000 annually from paying income tax, in response to public calls for more affordable living and higher take-home pay. (PNA)
