Employees to receive higher 13th month pay


President Benigno Aquino 3rd virtually gave government and private employees an early Christmas gift after he signed into law a measure raising to P82,000 the tax exemption cap on 13th month pay and other workers’ benefits.

Sen. Edgardo “Sonny” Angara, who sponsored the Senate measure, said that workers with 13th month pay not exceeding P82,000 can now enjoy their Christmas bonuses in full.

Originally, Senate Bill 2437 has set a P75,000 ceiling, which was eventually raised to P82,000 to expand the scope of the measure, according to Angara.

He said the P82,000 bonus ceiling came from Bureau of Internal Revenue Commissioner Kim Henares, when the proposed measure was being reviewed at the committee level.

According to Henares, P82,000 today is worth P30,000 in 1994 when Republic Act 7833 that set the tax exemption ceiling at P30,000 was enacted.

The new law is expected to benefit approximately half a million employees nationwide and will cost the government revenue losses of around P30 billion, based on Department of Finance projections.

The new law also provides for an automatic adjustment of the tax ceiling every three years, taking inflation into account.

“I thank the President for signing our bill (into law) despite strong opposition from the Finance Department. It’s a wonderful indication that the government is open to amending our out-dated tax system and making it more fair and equitable to all our taxpayers,” Angara said.

Angara is also pushing a proposed bill that seeks to lower individual income tax rates and adjust tax brackets across-the-board.


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  1. MANY THANKS po Sen. Angara and Pres. Aquino for that law. Many rank-and-file goverment az well as private sector employees will be benefited.