ACG Founding Chairman and Senior Tax Advisor Mon Abrea discussed the third tranche of the TRAIN Law in an interview. Starting 2023, income tax for individuals would be lowered for persons earning P250,000 and above annually. Those earning under P250,000 would not be affected by these changes as they have already been exempt from income tax since the passage of TRAIN Law.
Abrea noted, however, that these decrease in taxes will likely not be sufficient to combat the high inflation. Low and middle income earners face increased cost for electricity, food, and other basic necessities.
It is important, in solving inflation, for the government to implement both fiscal and monetary policies. The government must also exercise restraint in its expenses.
“Kung hindi sapat ang nakokolekta, dapat magbawas ng gastos para may pang-bayad sa utang ng gobyerno,” Abrea said.
He also noted that the government can look into other sources of income, such as imposing taxes on non-essential goods, such as luxury cars. The government could also look into imposing taxes on high-end condominiums.
He further emphasized that these taxes should not adversely affect ordinary citizens. For example, for motor vehicles, it should not affect the SUVs that ordinary taxpayers buy and instead affect only those that are truly luxury cars.
Watch the full interview here: https://www.youtube.com/watch?v=m0kIBmCE-g0