Incoming Rodrigo Duterte Considers Tax Hike For High Earners
The incoming President Rodrigo Duterte recently mulls raising the tax rates for people earning high and then lower the others.
In a report by Philstar, Duterte said it but didn’t give details about it.
According to Bureau of Internal Revenue commissioner Kim Henares, the tax system currently is “progressive” and said that this is much like of what Duterte wants to achieve.
But, according to Henares, it would be on how Duterte plans to change the rates of taxes and brackets. The Commissioner said that this has been proposed last year but has been denied.
The report says that under the National Internal Revenue Code, there are seven brackets in the taxation in the Philippines wherein the lowest bracket is charged 10 percent while the biggest is charged annually with 32 percent.
According to Finance Undersecretary and chief economist, Gil Beltran, this idea by the incoming President is feasible and can be calibrated in a way that the people won’t have revenue losses.
He also added that what Duterte is planning with the tax system of the country could be similar to what China has. There, the highest tax rate for an individual is at 45 percent.
“This is consistent with what is required in the Constitution which is a progressive tax rate. This is not discriminatory,” Beltran said as quoted in the report.
Henares agrees to Beltran, saying that “adding even these high-earners can easily claim deductions which, in effect, lower their taxable income down the bracket.”
Henares added that this is the reason why having a comprehensive tax reform is a need in the country in order to reduce the income tax and get additional revenues.
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