FINANCE Secretary Benjamin Diokno said they are not looking to cut personal income tax rates anytime soon despite calls to amend it amid rising consumer prices.
In a response to reporters on Wednesday, Diokno said it is still “too early to tinker” with personal income tax rates.
“We just amended both PIT and CIT. Let’s give the new tax system a chance to operate,” the governor said.
Calls have been made to lower the country’s income tax rates to cope with the rising inflation in recent months.
Just recently, ACT Teachers Representative France Castro filed a House Bill entitled Tax Reform Act for the Masses and the Middle Class (TRAMM).
“Rising prices and untamed inflation rates in the past few years all the more justify the need for a tax reform package that would reduce the income tax rates of the overburdened Filipino working class families,” Castro said.
“Reducing income tax rates for working families will not only improve their way of life but also strengthen their purchasing power which will boost overall domestic demand for consumer goods,” he added.
Just last week, the Development Budget Coordination Committee (DBCC) announced that revenue collections are projected to show a gradual, upward trend over the medium-term from P3.633 trillion in 2023 to P6.589 trillion in 2028.
“This will be achieved through the continued implementation of existing tax policy and tax administration reforms, bolstered by a robust economic growth,” the DBCC said.
Meanwhile, average inflation rate assumption for 2022 remains elevated and is projected to range from 4.5 to 5.5 percent, following the uptick in prices of fuel and food as a result of the ongoing Russia-Ukraine conflict and disrupted supply chains.
It is also adjusted to 2.5 to 4.5 percent for 2023, and is seen to return to the target range of 2 to 4 percent by 2024 until 2028.
