Find out the tax reforms in the TRAIN bill passed by the Senate from cosmetics to cars to coal
The Senate on Tuesday passed on third and final reading its version of the tax reform package.
With 17 affirmative votes and only one negative votes, the Senate approved what is also known as the tax reform for acceleration and inclusion (TRAIN) bill.
Senator Risa Hontiveros, the only senator who voted against the passage of the TRAIN, said that she felt that it ?fell short? of its promise to reform the tax system and be beneficial to the poor.
Senators who voted for TRAIN are Senate President Aquilino Pimentel III, Senate Majority Leader Vicente Sotto III, Senate Minority Leader Franklin Drilon, Senate President Pro-Tempore Ralph Recto, Senators Juan Edgardo Angara, Francis Escudero, Joseph Victor Ejercito, Nancy Binay, Grace Poe, Cynthia Villar, Loren Legarda, Sherwin Gatchalian, Richard Gordon, Gringo Honasan, Manny Pacquiao, Joel Villanueva, and Juan Miguel Zubiri.
Among the features of the Senate?s TRAIN bill is the reduced income tax rates of individual income taxpayers starting January 1, 2018.
Taxpayers earning P250,000 and below will be exempt from income tax, and those with gross sales or receipts of P500,000 and below will be exempt from three percent percentage tax.
An excise tax of P4.50 per liter will be imposed for beverages using caloric and non-caloric sweeteners, and P 9 per liter for beverages using high fructose corn syrup (HFCS).
However, excluded are milk, coffee, and fruit and vegetable juices, unsweetened tea, meal replacement and medically indicated beverages.
The measure also adjusted the rates to three tiers 1.75 (first year), 2.00 (second year) 2.25 (third year) for diesel and bunker fuel oil.
For automobiles, there will be a two-tier tax scheme that is 10 percent on cars that cost up to P1 million and 20 percent for those that cost more than P1 million.
As for passive income and other taxes, cosmetic procedures and body enhancements undertaken for aesthetic reasons will be imposed with a 10 percent excise tax.
Exemptions are medical reasons including reconstruction of facial and body defects due to birth disorders, trauma, burns, disease, and those intended to correct dysfunctional areas of the body.
The measure also increased the coal excise tax from P10 per metric ton to P100 per metric ton in the first of implementation, P200 in the second year, and P300 in the third and succeeding years.
The excise tax rates of all non-metallic minerals and quarry resources, and all metallic minerals including copper, gold and chromite were doubled from the current 2 percent excise tax to 4 percent.
Senate Minority Leader Franklin Drilon earlier said that the real battle will be in the bicameral conference committee since there are disagreeing provisions between the Senate and House of Representatives versions.
He said that if both chambers fail to arrive at a compromise on every disagreeing provision of the bill, there could be ?lengthy debates? that could derail its approval.
The TRAIN is expected to be for implementation by January 2018. (PNA)