Senate employees protest tax on gov’t fringe benefits

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Tuesday, August 12, 2014

SENATE employees protested on Tuesday the imposition of withholding tax on government workers' allowances, bonuses and other benefits.

The group Sandigan ng mga Empleyadong Nagkakaisa sa Adhikain ng Demokratikong Organisasyon (Senado) criticized the Revenue Memorandum Order (RMO) 23-2014 of the Bureau of Internal Revenue's (BIR), which took effect last June.

Senado president Dakila Millamena said the group has recently filed a petition at the Supreme Court seeking to nullify the RMO.


(Al Padila/Sunnex)

"We filed a petition to the Supreme Court regarding this matter and we expect that it would be acknowledged by the justices," Millamena said, as his group trooped to the hearing of the committee on ways and means on tax measures.

Earlier, BIR Commissioner Kim Henares told state workers that the law imposes withholding tax on fringe benefits.

"Under Section 32 of the Tax Code, all compensation, whether in cash or in kind whatever they may be called, are subject to income tax and therefore, proper withholding tax should have been deducted and remitted. Only exemption is up to P30,000 of the 13th month pay and bonuses," she said in a statement last week.

Instead of taxing the additional benefits of state workers, Millamena's group is seeking for a salary increase for minimum wage earners.

The group said the current P9,000 minimum wage of an average government workers should be raised to P15,000.

Senator Paolo Benigno "Bam" Aquino IV, for his part, is pushing for the passage of the Marginal Income Earners (MIE) bill, which seeks to exempt the minimum wage earners from paying taxes.

"In the bill, if you are a marginal income earner, you're exempted from filing taxes," said Aquino, the bill's author.

"Maybe this law can give them a breathing room," he added.

Aquino wanted the bill to be implemented to show fairness to the minimum wage earners, and in terms of implementation, the goal was to catch the "big fish." (Sunnex)

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