|
The Personal Equity and Retirement Account (PERA) bill has passed
the third reading at the House of Representatives after hurdling the
same at the Senate, the Philippine Stock Exchange (PSE) announced.
“In the midst of rising prices of goods and
services, and given employers’ constraints to hike workers’
salaries, PERA’s incentives will represent a welcome alternative.
Once enacted into law, PERA will reaffirm our lawmakers’
commitment to help workers and employees adjust to economic
difficulties,” Francis E. Lim, PSE president, said in a statement.
Both house versions of the bill seek to
establish the legal and regulatory framework for an alternative
pension fund that will give tax breaks to its members, and pave the
way for voluntary personal savings and investment plan.
The Senate version pegs the maximum PERA
contribution qualified to enjoy the tax credit at P50,000 for an
individual and P100,000 for a couple. The lower house version, on
the other hand, sets the maximum PERA contribution to P100,000 for
an individual contributor and to P200,000 for a couple.
At the behest of PSE, which has been lobbying
for the bill’s approval, the House version includes, apart from
tax perks, the granting of better incentives to overseas Filipinos
to maximum contribution level of P200,000 for an individual and
P400,000 for a couple.
Besides individual citizens who are working or
deriving incomes abroad, the House version states that persons who
have retained or re-acquired Philippine citizenship under the Dual
Citizenship Law be accorded the same status as overseas Filipinos.
The definition of overseas Filipinos includes legitimate spouses
whether or not they are of Filipino ancestry.
Under PERA, employers can contribute to the
employee’s fund to the extent of the amount allowable to the
contributor.
PSE said the allowable PERA investment products
would include shares of listed companies, exchange-traded funds,
unit investment trust fund, mutual funds, annuity contract,
insurance pension products and pre-need pension plans.
Both versions of the bill give PERA members a
tax credit equivalent to 5 percent of the member’s PERA
contribution and tax exemption for the income from the PERA
investments in the local capital markets. The proposed law also will
give tax deduction for employer contribution to the PERA account and
tax holiday for the distribution of the PERA contribution.
-- Likha Cuevas-Miel
|
