On 26 September 2014, the House of Representatives in plenary approved on third and final reading our House Bill 2970, An Act Increasing the Ceiling for the Total Exclusion from Gross Income of 13th Month Pay and Other Benefits to Seventy Thousand Pesos (P70,000), Amending for the Purpose Section 32(B)(7)(E) of the National Internal Revenue Code of 1997, as Amended.
HB 4970 seeks to exempt from income tax up to P70,000, from the current P30,000, 13th month pay and other benefits such as productivity incentives and Christmas bonus. It also mandates the Secretary of the Department of Finance to increase the P70,000 ceiling after a reviewing the effect of inflation rate on the amount at the end of the taxable year.
The bill awaits deliberation and approval by the Senate, then enactment into law upon signing by the President.
Click here for a copy of the engrossed bill.