MANILA – The House Committee on Ways and Means on approved measures seeking to raise the annual income tax exemption threshold to PHP350,000 from PHP250,000 and exempt microenterprises from the 2-percent Minimum Corporate Income Tax (MCIT).

The bills, introduced by Speaker Faustino “Bojie” Dy III and Majority Leader Ferdinand Alexander “Sandro” Marcos, were approved subject to style during a committee hearing chaired by Marikina 2nd District Rep. Miro Quimbo.

House Bills Nos. 10345 and 10346 form part of a broader tax reform package aimed at providing relief to individual taxpayers and small businesses while maintaining the government’s fiscal capacity.

The proposed income tax measure seeks to amend Section 24 of the National Internal Revenue Code by restructuring the graduated income tax rates for individual taxpayers.

Under the bill, individuals earning up to PHP350,000 annually would be exempt from personal income tax, potentially increasing the take-home pay of low- and middle-income workers.

“We want our tax system to keep pace with the realities faced by Filipino families and workers. If incomes have not kept up with the rising cost of living, then we have to make sure that taxation does not further erode their purchasing power,” Quimbo said.

The committee also approved a measure granting relief to micro and small enterprises from the 2-percent MCIT, citing the disproportionate burden of the tax on businesses operating on limited profit margins.

Quimbo said the proposed exemption would give small businesses greater room to reinvest, retain workers and sustain operations.

“The objective is not simply to reduce taxes. It is to create breathing room for entrepreneurs and businesses so they can spend, invest, hire, and grow,” he said.

The panel is also considering consolidating the proposed tax relief measures with corresponding revenue-generating measures into a single omnibus tax reform package.

Quimbo stressed that any reduction in government revenues resulting from the proposed exemptions must be matched with measures that would preserve fiscal sustainability.

“We are looking at the entire tax system as a whole. We want to deliver real relief to taxpayers, but we also have a responsibility to make sure that the government can continue to fund public services,” he said.

“That means balancing tax relief with responsible and sustainable revenue measures,” he added.