Senator Sonny Angara has welcomed the part of the proposed comprehensive tax reform package that seeks to exempt micro businesses and marginal income earners from income tax.
“Malaking ginhawa po para sa ating ordinaryong mamamayan na hindi na bubuwisan ang mga maliliit na negosyo. Sa pamamagitan nito, mas mabibigyan natin sila ng tyansa na lumago ang kanilang negosyo na magreresulta naman sa paglikha ng mga trabaho,” said Angara, chairman of the ways and means committee.
Under present tax regulations, marginal income earners are self-employed individuals deriving gross sales or receipts not exceeding P100,000.
Among them are farmers and fisherfolk selling directly to consumers, small sari-sari stores, small carinderias or turo-turos, and drivers or operators of a single unit tricycle.
Currently, marginal income earners are exempted from paying business taxes such as VAT and percentage tax but are still subject to income tax.
Micro businesses with assets below P3 million may be exempt from income tax, pursuant to the existing Barangay Micro Business Enterprise law, but they need to register first at the City Office of the Treasurer in their area.
“By automatically exempting, in effect, marginal income earners and micro businesses from income tax, we would finally afford them equal protection and benefits that the minimum wage earners have long been enjoying,” the lawmaker said.
Under the bill approved by the House of Representatives, a distinction has been made between compensation income earners and the self-employed or professionals in the proposed new income tax regime.
According to the Department of Finance, it seeks to impose a one-time flat tax to self-employed and professionals so as to encourage these hard-to-tax individuals to voluntarily and timely comply with their tax obligations.
“Ang importante dito ay gawing simple at mas madali ang sistema ng pagbubuwis upang matulungan ang ating mamamayan na magbayad ng tamang buwis. Dahil talagang nahihirapan ang karamihan lalo ng ang ating mga maliliit na negosyante sa kumplikadong sistema sa kasalukuyan,” the veteran legislator stressed.
The seasoned lawmaker said he will study carefully the various proposals on how to reform the tax regime for self-employed and professionals so it would ultimately benefit the small businesses.