Senator Sherwin Gatchalian on Monday, January 16 assured that middle income taxpayers can expect a higher take-home pay starting this year due to the Tax Reform for Acceleration and Inclusion (TRAIN) Law.

Under the TRAIN law, taxpayers earning more than P250,000 a year but not over P8-million wold be subjected to lower income tax rates ranging from 15 percent to 30 percent, from the previous 20 to 32 percent, starting 2023.

“Inaasahan natin na lalo pang lalakas ang domestic consumption na may malaking kontribusyon sa paglago ng ating ekonomiya (We expect that domestic consumption will grow even stronger with a large contribution to the growth of our economy),” Gatchalian said in a statement.

“Dahil sa pinababang buwis, mas mataas ang take-home pay ng mga empleyado na magiging malaking tulong sa gitna ng mataas na presyo ng mga bilihin (Due to reduced taxes, the employees' take-home pay will be higher which will be a big help amid the high prices of goods),” the senator said.

Based on his computation, Gatchalian said a public school teacher categorized as Teacher 1 with a monthly salary of P27,000 or Salary Grade (SG) 13 who has an annual income of P351,000 will now have monthly tax savings of P420.83 or P5,050 for the entire year.

Also, a government nurse categorized as Nurse III or SG 17 who has an annual income of P559,390 or P43,030 monthly will now have monthly savings of P1,289.13 or annual tax savings of P15,469.5.

“Dahil sa mas mataas ang kanilang kita, inaasahan din natin na magiging maganda itong insentibo para sa mga empleyado na lalo pa nilang paghusayan ang kanilang trabaho at magtulak sa kanila para mag impok o kaya ay mamuhunan (Because of their higher income, we also expect that this will be a good incentive for employees to improve their work even more and push them to save or invest),” Gatchalian said.

On the other hand, individual taxpayers with annual taxable income amounting to P250,000 or below will continue to be exempt from paying income tax.