Proposed tax reforms are expected to cost the government roughly ₱66 billion in annual revenue as the Marcos administration trades fiscal collection for broader consumer and small-business relief, according to the Department of Finance (DOF).

Finance Secretary Frederick D. Go said the package, outlined by President Ferdinand Marcos Jr. during his State of the Nation Address, aims to lift take-home pay for more than three million employees while easing financial pressure on tens of thousands of small businesses.

“I’d like to say that the DOF fully supports all the reforms and measures mentioned by President Bongbong Marcos at the SONA as far as they relate to the DOF and its attached agencies,” Go said during a briefing hosted by the Bureau of Customs (BOC).

Under the proposal, raising the personal income tax threshold will exempt an additional 1.2 million workers—bringing the total number of tax-exempt earners to 6.3 million from the current 5.1 million, and providing financial relief to 3.13 million employees overall.

“It will ultimately increase workers’ take-home pay,” the DOF said. “Those earning between ₱250,000 and ₱350,000 annually will enjoy up to ₱15,000 in additional annual net income, while workers earning ₱350,000 and above will receive a maximum increase of ₱17,500 in annual take-home pay.”

“This means a bigger share of hard-earned income can go toward everyday needs, savings, and future financial security,” the department added.

Similarly, the proposed exemption from the minimum corporate income tax (MCIT) is expected to benefit more than 78,000 tax-paying micro and small enterprises (MSEs) by easing their tax burden. This relief covers neighborhood businesses such as small bakeries, cafés, eateries, food stalls, sari-sari stores, repair shops, and other family-run enterprises.

Under the current system, MSEs pay whichever is higher: a two percent MCIT based on gross income or the regular 20 percent corporate income tax (CIT) based on net taxable income. Under the proposed reform, loss-making businesses would no longer be required to pay the MCIT.

Beyond easing financial burdens, the reform is expected to improve cash flow for entrepreneurs, allowing them to reinvest in business expansion, create jobs, and sustain their operations.

According to Go, the government stands to forego around ₱60 billion in revenue from personal income tax relief and another ₱6 billion from MSE exemptions.

Other priority legislative measures backed by the DOF include a general tax amnesty (GTA) to assist taxpayers with unsettled obligations. According to the DOF, the measure “seeks to give individuals and businesses a fresh start while broadening the tax base and generating additional revenues for priority infrastructure and social programs.”

DOF documents indicated the amnesty will cover income tax, donor’s tax, and value-added tax (VAT), allowing taxpayers to settle unpaid liabilities for 2023 and earlier years at reduced rates based on total assets or net worth.

Furthermore, the DOF reiterated its support for extending the estate tax amnesty, which would allow heirs to settle the estates of decedents who died on or before June 30, 2024, through Dec. 31, 2028. The proposal is currently pending before the Senate Committee on Ways and Means.