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Tax relief for medical frontliners proposed

THE House committee on ways and means approved in principle a substitute bill proposing a 25 percent discount in the tax on income earned by healthcare workers from work as COVID-19 frontliners.

Members of the committee is not endorsing any tax for the hazard pays and other allowances earned by the frontliners in their performance of duty amid the coronavirus disease.

The 25 percent discount will likely cover the taxes they would have owed on their COVID-19 allowances.

The revenue implication of the original proposal, a full tax exemption, was P9 billion, according to a position paper sent by the Department of Finance (DOF).

Senior Vice Chair, Nueva Ecija Rep. Estrellita Suansing, suggested the 25 percent discount as a compromise.

The exemption granted in this proposal will only cover the salary or compensation, as well as the gross receipts from the exercise of profession or employment received by a frontliner for Taxable Year 2020.

The exemption will not cover income received by medical frontliners from their other businesses, investments and other kinds of passive income not related to serving, treating caring, aiding, assisting COVID-19 patients

To help frontliners file their income taxes on time given the potential changes in their tax calculations, the Secretary of Finance will also be given the authority to extend tax filing by six months.

Publication Source :    People's Journal