Gatchalian Pushes for Higher Tax Exemption for Filipino Workers
Good news for Filipino employees! Senator Sherwin Gatchalian is proposing a bill that could help workers take home more of their hard-earned income.
The “Granting Increase in Take-Home Pay for All Working Filipinos Act”, also known as the Ginhawa Bill, seeks to raise the annual income tax exemption from ₱250,000 to ₱400,000.
This measure could lead to more savings and better financial stability for millions of workers across the country.
What the Ginhawa Bill Proposes
Here’s a simplified breakdown of the bill’s key provisions:
- No income tax for those earning ₱400,000 or less annually
(Currently, only incomes of ₱250,000 or below are tax-free.) - Tax-free bonuses up to ₱150,000
(Up from the current limit of ₱90,000.) - Income tax exemptions for other work-related compensation, including:
- Overtime pay
- Night differential
- Holiday pay
- Hazard pay
- No income tax on service charges received by employees in restaurants and similar industries
Why This Matters for Workers and Employers
The proposed Ginhawa Bill aims to:
- Help workers cope with rising living expenses
- Ensure fairer compensation, especially for hazardous or extended work hours
- Reduce the tax burden on low- to middle-income earners
As Gatchalian emphasized:
“Hazard pay is given precisely because the job is risky. The government should not deduct from it.”
What You Can Do Next
- Employees: Stay updated on this proposed law—it can directly affect your take-home pay.
- Employers: Prepare to adjust payroll systems if this bill is passed to comply with the new tax treatment.
- Business owners: Consider reviewing your tax policies and seek expert guidance on implementation.
Need Help with Payroll or Tax Compliance?
At UNA Tax and Accounting Services, we help businesses ensure accurate payroll, proper tax computation, and compliance with changing tax regulations.
Book your FREE 15-minute consultation with our experts today or email us at sales@una-acctg.com
