Malacañang on Monday appeared willing to cut income tax rates as proposed by Sen. Juan Edgardo Angara.
Palace spokesman Edwin Lacierda echoed the statement of Internal Revenue Commissioner Kim Henares that they would look into the proposal.
“Who wouldn’t want to pay lower tax? But, again, we have to balance all interests. That’s the only concern of government,” Lacierda said.
He said that priority should be on tax bills pending in Congress.
“Let’s just focus first on tax reform bills that currently are in the pipeline of the legislature and then let’s study and see if there’s a need to restructure based on the bill by Senator Angara,” he said.
Lacierda added that while they would want lower taxes to be one of the achievements of the Aquino administration, the process is long and requires a “comprehensive study.”
Angara is the author of Senate Bill 2149, which aims to reduce the rates of individual income tax from the current 32 percent to 25 percent in 2017.
The measure will adjust individual income tax brackets based on a person’s capacity to pay.
Angara said the income tax cut would be in step with the Philippines’ commitment to the Asean Economic Blueprint.
Of the 10 members of the Association of Southeast Asian Nations, only three—the Philippines, Thailand and Vietnam—have the highest rates of individual income tax.
Manila is third highest, next to Vietnam (35 percent) and Bangkok (37 percent).
The tax bracket in Cambodia is 20 percent; Indonesia, 30 percent; Laos, 24 percent; Malaysia, 26 percent; Myanmar, 20 percent and Singapore, 20 percent.
Angara said the country’s individual income tax bracket has remained unchanged since 1997 but the consumer price index has almost doubled.