House passes bill raising tax ceiling for bonuses on final reading

By on September 27, 2014

(Malacanang stock photo)
(Malacanang stock photo)

MANILA — The House of Representatives on Friday passed on third and final reading the bill seeking to increase the tax exemption ceiling for the 13th month pay, Christmas bonus and other benefits of employees.

House Bill 4970 seeks to amend Section 32(B)(7)(E) of the National Internal Revenue Code of 1997 by increasing the ceiling for the total exclusion from gross taxable income of employees’ 13th month pay and other benefits from the current Php30,000 to Php70,000.

The vote was unanimous — with 250 for the bill; none against; and no abstentions.

The authors of the bill are Act Teachers Rep. Antonio Tinio, Makati Rep. Mar-len Abigail Binay, Batangas Rep. Raneo Abu, Iloilo City Rep. Jerry Trenas, Nueva Ecija Rep. Estrelita Suansing, Paranaque City Rep. Gus Tambunting, Cagayan De Oro Rep. Rufus Rodriguez, and Bohol Rep. Arthur Yap.

The lawmakers said that the new tax exemption ceiling is needed as the Php30,000 cap has long been outpaced by inflation.

The bill will be immediately transmitted to the Senate where a similar bill has been filed by Senator Ralph Recto.

Both Speaker Feliciano Belmonte Jr. and Senate President Franklin Drilon had earlier voiced their support for the measure.

Once enacted before the year ends, employees in both the public and private sectors will be able to take a larger amount of 13th month pay and bonuses by 2015.