19/05/2026
📢 ₱400,000 Income Tax Exemption Proposed?
A proposal has been raised to increase the income tax exemption threshold to ₱400,000 annually to help improve workers’ take-home pay amid rising living costs. Currently, under the TRAIN Law, only annual taxable income up to ₱250,000 is exempt from income tax.
If approved, this could mean:
✅ Higher net pay for middle-income earners
✅ Increased consumer spending power
✅ Additional relief against inflation pressures
However, this also raises important questions:
💭 Can government revenues absorb the impact?
💭 Will businesses eventually adjust compensation structures?
💭 Is this enough to offset rising prices and living costs?
For finance leaders, HR professionals, and business owners, this is another development worth monitoring as it may directly affect payroll planning, compensation strategy, and tax forecasting.
https://www.philstar.com/headlines/2026/05/06/2526075/p400000-income-tax-exemption-sought-raise-take-home-pay
A tax relief bill seeks to raise the tax-free income threshold to P400,000 a year as workers face rising prices.
