Labor and Employment Secretary Rosalinda Baldoz said the government will be expanding the list of de minimis benefits to be exempted from income tax on compensation.
The expanded list will include benefits under collective bargaining agreements (CBAs) and productivity incentive schemes, Baldoz said.
"This is a fitting gift to our workers in this holiday season," Baldoz said.
“With this, millions of Filipino workers could welcome the new year with a more realistic hope of sharing in the country’s growing prosperity. That is what inclusive growth is.''
The DOLE and the Department of Finance had agreed that the measure will take effect in January 2015.
Baldoz said the total amount of de minimis benefits that each worker-taxpayer can claim when the measure takes effect will reach P104, 225.
This is an increase of P10,000 from the current level of P94, 225.
The Bureau of Internal Revenue’s regulation on de minimis benefits was last amended in 2012. She said the BIR will issue new revenue regulations to make the measure effective.
Baldoz said expanding the list of tax-exempt de minimis benefits is a way to ensure that workers are rewarded for their labors.
Baldoz said that expanding the list of tax-exempt de minimis benefits was sought by labor groups at a dialogue with the President during Labor Day this year.
Secretary of Finance Cesar V. Purisima said P16.9 billion in revenues is expected to be foregone once the BIR revenue regulation takes effect.
“We believe that the expansion of tax-exempt de minimis benefits is fairer and more equitable than other measures of tax relief benefiting only a small percentage of the working population," Purisima said.
"This measure directly impacts the working poor and the smallest income earners, who stand to have the most to gain from these benefits. We came to this agreement after a thorough consideration: we think this is a win for all Filipinos.''