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Wednesday, December 13, 2017

Lower Income Tax, Higher Taxes On Sugar, Petroleum, Tobacco Products By 2018.


The House of Representatives ratified the bill that will lower the personal income tax while taxes on sweetened beverages, petroleum products, cars and tobacco will be higher. The new tax package is expected to generate ₱134 billion to fund the administration's infrastructure projects, while reducing income tax for the 6.8 million individual income taxpayers has been approved after several meetings of the bicameral  conference committee. The Congress finally approved the consolidated version of the Tax Reform for Acceleration and Inclusion (TRAIN) bill.  Those earning ₱250,000 annually or around ₱22,000 per month will be exempted from paying taxes, including self-employed individuals. The bill also exempts 13th month pay and bonuses amounting to ₱90,000 from taxation.  The new scheme will also lower income tax rates for those earning ₱2 million and below.  Self-employed individuals and professionals may also opt to pay eight percent of their annual income tax, instead of scheduling tax returns every quarter.  President Rodrigo Duterte called the tax reform package as one of the urgent bills to pass in Congress. The President should receive the consolidated version of the bill for veto or approval before it takes effect. Higher petroleum taxes  The bill also provided for varied tax increases in petroleum products, while keeping to a minimum the increase in liquefied petroleum gas (LPG), diesel, and gasoline.  According to the Finance Department, the two million richest Filipino families consume 50 percent of oil products in the country.  The bicameral conference committee spread the ₱3 rate increase for LPG over three years—a peso per year increase from 2018 to 2020.  The proposed increase in diesel and bunker fuel—mostly used for public transportation—will be collected in 3 tranches: ₱2.50 next year, ₱4.50 in 2019 and ₱6 in 2020.  Sponsored Links  More environment-friendly tax scheme?  The consolidated TRAIN bill also provided for a four-tier tax scheme, to accommodate the around 80 percent of Filipino households who do not own cars.  Electric vehicles shall be exempt while hybrid cars will be taxed at half the rates, to encourage greener and cleaner transportation. Pick-up trucks will be exempt as well, as the bill notes they are commonly used by businessmen and entrepreneurs for commercial and agricultural purposes.  Cars priced up to ₱1 million will be charged 10 percent tax. Those worth more than ₱1 million will taxed at a 20 percent rate, while cars priced up above ₱4 million will be taxed 50 percent.  The bill will also increase coal excise tax from ₱10 per metric ton to ₱150 per metric ton in a span of three years. The increase will be in increments of ₱50, starting from ₱50 in 2018.  The excise tax rates for all non-metallic minerals and quarry resources, and all metallic minerals were also raised from the current two percent to four percent. Sugar, tobacco, and cosmetic taxes  The consolidated TRAIN bill imposed a tax of ₱6 per liter for beverages using caloric and non-caloric sweeteners, and ₱12 per liter for beverages using high fructose corn syrup.  All milk and coffee products are exempted from sugar tax, as well as natural fruit and vegetable juices and meal replacements. Medically-indicated beverages would not be taxed as well.  Meanwhile, tobacco excise taxes will be raised in phases at ₱2.50 per annum—starting at ₱32.50 next year.  Cosmetic surgeries and enhancements for aesthetic reasons will also be imposed a five percent excise tax, which was down from the proposed 20 percent. VAT exemptions  The TRAIN bill, however, exempts small businesses with total annual sales of ₱3 million and below from VAT. This, as small and micro businesses represent 98 percent of all registered businesses in the country.  VAT exemptions for raw food or agricultural products, health and education, as well as of senior citizens, Persons with Disability (PWDs), business process outsourcing (BPOs), and cooperatives will be retained.  The sale of prescription drugs and medicines prescribed for diabetes, high cholesterol, and hypertension will be VAT-free starting 2019.  Source: CNN     Advertisement  Read More:                 ©2017 THOUGHTSKOTO  www.jbsolis.com   SEARCH JBSOLIS, TYPE KEYWORDS and TITLE OF ARTICLE at the box below
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The House of Representatives ratified the bill that will lower the personal income tax while taxes on sweetened beverages, petroleum products, cars and tobacco will be higher.
The new tax package is expected to generate ₱134 billion to fund the administration's infrastructure projects, while reducing income tax for the 6.8 million individual income taxpayers has been approved after several meetings of the bicameral  conference committee. The Congress finally approved the consolidated version of the Tax Reform for Acceleration and Inclusion (TRAIN) bill.

Those earning ₱250,000 every year or around ₱22,000 on a monthly basis will be exempted from paying taxes, including self-employed individuals. 13th month pay and bonuses amounting to ₱90,000 from taxation are also exempted under the bill.

The new scheme will also lower income tax rates for those earning ₱2 million and below.

President Rodrigo Duterte called the tax reform package as one of the urgent bills to pass in Congress. The President should receive the consolidated version of the bill for veto or approval before it takes effect.

Higher petroleum taxes

The bill also provided for varied tax increases in petroleum products, while keeping to a minimum the increase in liquefied petroleum gas (LPG), diesel, and gasoline.
 Finance Department said that the two million richest Filipino families consume 50% of petroleum products in the country.

The bicameral conference committee spread the ₱3 rate increase for LPG over three years—a peso per year increase from 2018 to 2020.

The proposed increase in diesel and bunker fuel—mostly used for public transportation—will be collected in 3 tranches: ₱2.50 next year, ₱4.50 in 2019 and ₱6 in 2020.

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qThe consolidated TRAIN bill also provided for a four-tier tax scheme, to accommodate the around 80 percent of Filipino households who do not own cars.

Electric vehicles will be exempted from tax while hybrid cars will be taxed at 50% rates, to encourage greener and cleaner transportation. Pick-up trucks will also be exempted, as the bill notes they are commonly used by businessmen and entrepreneurs for commercial and agricultural purposes.

The bill will also increase coal excise tax from ₱10 per metric ton to ₱150 per metric ton in a span of three years. The increase will be in increments of ₱50, starting from ₱50 in 2018.

The excise tax rates for all non-metallic minerals and quarry resources, and all metallic minerals were also raised from the current two percent to four percent.
Sugar, tobacco, and cosmetic taxes

The consolidated TRAIN bill imposed a tax of ₱6/liter for beverages using caloric and non-caloric sweeteners, and ₱12/liter for beverages using high fructose corn syrup.

However, all milk and coffee products are exempted from sugar tax, as well as natural fruit and vegetable juices and meal replacements. Medically-indicated beverages will also be exempted from taxes.

Meanwhile, tobacco excise taxes will be raised in phases at ₱2.50 every year—starting at ₱32.50 next year.

Cosmetic surgeries and enhancements for aesthetic reasons will also be subjected to 5% excise tax, which was down from the proposed 20 percent.

The TRAIN bill, however, exempts small businesses with total annual sales of ₱3 million and below from VAT. This, as small and micro businesses represent 98 percent of all registered businesses in the country.

VAT exemptions for raw food or agricultural products, health and education, as well as of senior citizens, Persons with Disability (PWDs), business process outsourcing (BPOs), and cooperatives will be retained.

The sale of prescription drugs and medicines prescribed for diabetes, high cholesterol, and hypertension will be free of VAT starting 2019.
Source: CNN
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