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First 250K Income of Compensation Earners Exempted from Tax under TRAIN

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The first P250,000 in taxable income of compensation earners will be exempted from the personal income tax (PIT) under the proposed Tax Reform for Acceleration and Inclusion Act (TRAIN), with families receiving a combined monthly income of between P13,000 and P40,000 increasing their take-home pay between P1,100 and 3,500 per month –or P14,000 to P42,000 per year–according to the Department of Finance (DOF).

DOF computations show that even with the slightly higher expenses that taxpayers would incur under the TRAIN’s revenue-enhancing provisions, the increases in their take home pay would more than offset these additional costs.

These revenue-enhancing provisions include expanding the value-added tax (VAT) base, and adjusting the tax for fuel and automobiles and imposing a tax on sugar-sweetened beverages, among other measures.

“The income tax exemption for the first P250,000 that every compensation earner makes annually is the gift of President Duterte to the Filipino people,” Finance Secretary Carlos Dominguez III said. “This means that those earning around P20,000 and below per month will pay zero.”

Dominguez said that under the new Personal Income Tax (PIT) rates as proposed in the TRAIN bill, those earning P250,000 and below will pay zero tax while the next tax brackets were adjusted to make the system more progressive. Only the ultra-rich or those earning P5 million and above pays the marginal tax rate of 35 percent.

As an example, two call center agents earning a monthly income of P21,000 each with four kids or dependents will get a PIT savings of P3,984 a month. Such tax savings would more than offset their additional expenses totaling P982 a month under TRAIN.

Based on data from the 2015 Family Income and Expenditures Survey (FIES), the DOF computed the additional monthly costs for them under TRAIN as follows: P288 for the value-added tax, P201for the fuel excise tax adjustment, an inflationary effect of P113, the impact of the SSB tax at P190 and an added P190 if they are paying monthly amortization for an entry-level mass market sedan.

For a sole breadwinner in one family getting P13,000 a month with one dependent, he or she will be exempted from paying the PIT, which means an increase in take-home pay of P8,940 a year or P745 a month. Based on the FIES, this type of household will incur additional expenses of P211 a month, but will be qualified to receive a targeted transfer of P200 a month under the TRAIN for a period of four years. Together with the PIT savings, this means that this household will be better off.

If the breadwinner with two dependents receives a monthly salary of P21,000, the PIT reform means an additional take-home pay ofP22,668 per year or P1,889 a month. The tax savings will more than offset the rise in household expenses of P398 a month.

A family with two working members earning a combined P37,000 a month is estimated to get a tax break of P47,207. This means an additional take home pay for them of P4,627 a month to help offset the additional household costs computed at P693.

If the family income with two working members amounts to P52,000, the net tax savings would be P67,881 under TRAIN because the PIT would generate savings of P6,800 a month. Estimated additional household costs arising from the TRAIN’s revenue-enhancing provisions were computed at P1,143 per month.

Meanwhile, a family with three working members earning a combined P76,000 a month would gain back P119,640, or tax savings of P9,970 a month to enable them to cope with additional household costs estimated at P2,227 per month.

Tax reform, Dominguez said, is an indispensable component of the President’s broad economic strategy dubbed “DuterteNomics,” which aims to sustain a high growth rate of seven percent over the medium term and bring down the poverty incidence rate to 14 percent by 2022.

The proposed TRAIN, which was passed by the House of Representatives as House Bill No. 5636, will also end the country’s complex tax system that has become vulnerable to evasion and leakages by transforming it into a “simple, just and efficient” structure, he noted.

HB 5636 is a consolidation of the original tax reform bill—HB 4774—filed by Quirino Rep. Dakila Carlo Cua, and 54 other tax-related measures. (DOF)

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Duterte Highlights Responsible Use of Digital Platforms

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President Rodrigo Duterte on Tuesday highlighted the responsible use of the digital platform in communicating truth as he urged communications and information officers to write and tell stories of the people.

This was the gist of the President’s speech read by Presidential Communications Secretary Martin Andanar during the second day of the National Information Convention at SMX Convention Center in Davao City.

Though recognizing the different modes of communicating and advocating government programs and policies based on speed and sophistication, Duterte raised questions about the outcomes of using digital media.

“What do we get out of the contents on the Internet? Are they fact-based on good reasoning? Do they have the capacity to affect our thinking correctly? Is there some relevance to the way we can, individually and collectively, improve our lives, restore a sense of compassion and concern, do justice where it is rightfully due, and, most importantly, safeguard the future?” the President’s message read.

Duterte said the questions can be answered during the convention.

The President also underscored the importance of sharing the truth through various platforms.

He also highlighted the power of words of change as a radical transformation in eradicating destructive elements such as his war on drugs, criminality, corruption, and terrorism.

“The battle zones surround all of us; and, as the communication and information officers of the government, you are bound to fight these wars as a matter of duty and for the honor of being the public servants of our people,” he said.

He stressed that words are most effective instruments one can use in confronting a fractured world.

“There are truths and certainties we must speak of in order to elicit respect for the law, the honor for authority, a sense of discipline, decency and pride in being a Filipino who is capable of defending our community when it is under siege,” he added.

“As information officers, therefore, your words should approximate these truths,” he said.

He further urged communications and information officers to leave ugly stories of those who scatter hatred, anger, divisiveness, with the cruelty of their lies and the wounds they cause with their poisoned pens.

“We must gather the goodness that is inherent in our hearts, and turn this into the advancement of understanding, harmony, unity and peace,” he said.

He said the essence of communication is truth-telling in their reports.

“The bonds that unite us together, are the stories we must tell our people; and, in the re-telling of our stories, in the re-creation of our communication, our world is re-created,” Duterte stressed.

Duterte expressed hope that NIC would strengthen government communications and information officers to be the perfect professionals.

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PDEA Aims to Free Up to 8k Barangays Yearly from Illegal Drugs

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Philippine Drug Enforcement Agency (PDEA) Director General Aaron Aquino targets to free 7,000-8,000 barangays per year from illegal drugs, as President Rodrigo Duterte has four years left to fulfill his campaign promise.

“We have a timeline of four years more before the President steps down and we need to clear 7,000-8,000 barangays per year,” Aquino said during a forum on the administration’s “Rehabinasyon” program on the first day of the three-day National Information Convention (NIC) in Davao City on Monday.

Combining the Filipino words for rehabilitation and nation, “Rehabinasyon” aims to take a holistic approach to eliminating the country’s drug problem by putting a premium on the rehabilitation of drug surrenderers, saving the youth from the evils of drugs, and envisioning a drug-free nation with a better future.

The PDEA chief said more than 24,000 barangays have yet to be cleared of illegal drugs. As of Feb. 8, 2018, the Duterte administration has cleared 5,327 barangays of prohibited substances.

Aquino also reported the agency has conducted 85,068 anti-drug operations and arrested 121,087 drug personalities in anti-drug operations.

He pointed out PDEA has seized P19.61-billion worth of evidence from 9 drug laboratories and 179 drug dens.

Aquino added the agency has arrested 454 government workers, including elected officials, and rescued 618 minors.

The PDEA chief also said the agency targets to establish offices in the Philippines’ 13 key ports to stop the entry of illegal drugs in the country, noting that more than 80 percent of illegal drugs in the country comes from overseas.

The PDEA chairs the Inter-Agency Committee on Anti-Illegal Drugs (ICAD) created by President Duterte in March 2017.

ICAD launched the Rehabinasyon program, which features three components: RealNumbers, RealSolutions, and RealStories.

Under these components, initiatives like information dissemination, treatment of drug dependents, livelihood programs, job security, and alternative modes of development will be reintroduced and implemented across the country.

President Rodrigo Duterte won the 2016 elections under the campaign promise to rid the country of illegal drugs and curb corruption in government.

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DPWH Resumes Road Repair Works on 7 Roads in Metro Manila

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The Department of Public Works and Highways (DPWH) will continue its road reblocking and repairs in the cities of Quezon and Caloocan this weekend.

According to DPWH National Capital Region Director Melvin B. Navarro, the repair and rehabilitation in six (6) major roads in Quezon City and one (1) in Caloocan City covering an area of 2,136.35 square meters will start 11 PM Friday, 16 February 2018.

In Quezon City, reblocking and repair works will be done at the northbound direction of the following roads: Visayas Avenue in front of the Department of Agriculture (DA) outerlane; EDSA between Landers Street to Howmart, 5th lane; Congressional Avenue Extension corner Tandang Sora Avenue, 1st lane; Congressional Avenue from EDSA to Cagayan Street, 3rdlane; Quirino Highway from T. Urbano to Pagkabuhay Road, inner lane; and A. Bonifacio Avenue from Calavite Street to Mariveles Street, middle lane. Also included is the southbound direction of A. Bonifaco Avenue, crossing Sgt. Rivera, middle lane.

Repair works will also be undertaken at the northbound direction of Bonifacio Monumento Circle in Caloocan City.

Motorists are advised to use possible alternate routes to avoid traffic congestion in the affected areas.

Using one (1) day concrete mix, affected roads will fully open 5 AM Monday, 19 February  2018. (DPWH)

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Improved Infra, Eased Regulations to Boost Trade, Investments in ASEAN

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Member countries of Association of Southeast Asian Nations (ASEAN) need to improve physical infrastructures and streamline regulatory processes in an effort to facilitate trade and investments in the region, according to a report from state think tank Philippine Institute for Development Studies (PIDS).

In a report titled “ASEAN connectivity: The hows and whys,” PIDS information officer Neille Gwen de la Cruz noted that connectivity is important to the region’s continued economic growth and an integral factor to realize the vision of an ASEAN Community by 2025.

ASEAN leaders have adopted the Master Plan on ASEAN Connectivity 2025, which has the goal of achieving a “seamlessly and comprehensively connected and integrated ASEAN that will promote competitiveness, inclusiveness, and a greater sense of Community” by the year 2025.

“Right now, ASEAN is recognized as one of the world’s largest economic zones. Making it easier to transport goods and services, reducing cumbersome processes, or simply opening more ways for people to move around the region would help facilitate the growth of ASEAN SMEs (small and medium enterprises),” said De la Cruz.

Citing an ASEAN Secretariat data, she said SMEs comprise 90 percent of companies in the region and contribute to as much as 60 percent of the region’s gross domestic product, making them the driving force of economic growth in the ASEAN.

“One of the main advantages of having an integrated region is having a seamless trade. Once the means to move from one country to another has been provided, there would be a freer flow of goods, services, and workers within and across the region, bolstering the perception that the region is an attractive market,” she added.

The PIDS report noted that an interconnected ASEAN is also envisioned to promote knowledge sharing and cultural exchange through improved physical infrastructure, streamlined regulatory processes and harmonized procedures and standards.

These are expected to create significant positive impacts on the region’s SMEs, as well as tourism and human resources, among others, it said.

“Promoting ASEAN connectivity will also boost tourism by capitalizing on the diverse history and culture of the region. Easing visa requirements across ASEAN would encourage greater mobility of people,” De la Cruz added.

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