Senator Jinggoy Ejercito Estrada is now pushing for a bill seeking to lower the individual income tax rates to increase the take-home pay of workers, particularly for low and middle-income earners.

In filing Senate Bill No. 1685, Estrada proposes to adjust tax brackets starting in 2027 by amending Section 24 of Republic Act No. 8424, otherwise known as the National Internal Revenue Code of 1997.

He said the measure aims to make workers feel the benefits of the Tax Reform for Acceleration and Inclusion (TRAIN) law.

"When there is more left over from wages, families can spend more, money circulates more in the economy, and the quality of life improves. We need to make our workers feel the real benefit of tax reform – a bigger take-home pay," Estrada said.

The senator noted that while the TRAIN law increased the take-home pay of many workers by lowering income taxes, studies show that the benefits have been reduced due to the increase in the prices of goods and services, especially basic necessities.

The bill, he said, seeks to address the concerns raised by the studies, particularly by the Al-Kindi Center for Research and Development, published in 2022, by further increasing the take-home pay of workers.

“This is about giving our workers a fair chance at a better life. Lower taxes mean higher take-home pay, and higher take-home pay means stronger families and a stronger nation,” the senator stressed. 

Under SB No. 1685, individuals earning up to P500,000 annually will be exempt from paying income taxes, while those earning above this threshold will be taxed lower than the current rates. 

Once passed into law, the measure will directly benefit low- and middle-income earners, giving them more funds to cover their daily needs, save for emergencies, and invest in their children’s education.