The accompanying solution to this would be the revitalization of

policies behind the Philippines' income taxation. In Asia, the Philippines,

together with India, have the highest corporate income tax rate of 30%
compared to their neighboring countries. Other countries in the region have
at most 25.5%. While Hong Kong is running in last place with the lowest
corporate income tax rate of 5%. Regarding personal income tax, the
Philippines lands on 2nd place with 32% behind Thailand and Vietnam with
both at 35%. Cambodia, at 0.8%, has the lowest personal income tax rate.
(Runckel and Associates, Inc.)
Marikina City 2nd District Rep. Romero Quimbo became concerned
with this and has filed a new tax bill. He stated that, Tax brackets have
remained unchanged since 1997 and have not been adjusted to inflation
Workers salaries have been adjusted for inflation, but tax brackets remain
frozen. A vast number of workers have been pushed to higher brackets, thus
paying higher tax rates, (qtd. in Politiko Luzon). Quimbo said the new bill
would have four brackets, which mean that workers earning less than
P180,000 a year would be exempted from paying income taxes while
workers who earn P180,000 to P500,000 would pay a tax rate of nine
percent. He added that those who earn between P500,001 to P10 million a
year would have a tax rate of 17 percent while those with more than P10
million of earnings would pay a 30-percent income tax. With this, the
lawmaker said that corporate taxes would be reduced to 25 percent.
(Politiko Luzon)
However, the government was not in full support of this. They
estimated to lose at least P30 billion (P639.13 million) during the first year
of its implementation. Palace Communications Secretary Herminio Coloma
Jr. says that "taxes are the lifeblood of the economy"(qtd. in Rappler.com).
Having high income tax rates is not a problem in itself, as different
countries would have their different fiscal policies and developmental goals.
The Philippines is still a developing country and needs the high tax
revenues to fund its further development.

In response to this, Senator Sonny Angara filed a new tax reform bill
with similar objectives of revisioning the income tax brackets but without
tax rate cuts as Quimbo proposed. "While our initial proposal was to lower
the tax rates across-the-board and compress the tax brackets from seven to
five, adjusting income taxes to take into account inflation is a more viable
proposal for the remaining time of the present administration. This is the
minimum position our government can take in reforming our outdated and
unjust tax system," (Senate of the Philippines) said Angara, chairman of the
senate's ways and means committee.
Under Senate Bill 3003, the seven tax brackets will be retained but
with the following adjustments:
Bracket 1: Those earning not over P23,000 would pay a fixed tax
rate of 5 percent.
Bracket 2: Those earning over P23,000 but not over P68,000
would pay a fixed tax of P1,100 plus 10 percent of the excess
over P23,000.
Bracket 3: Those earning over P68,000 but not over P160,000
would pay a fixed tax of P5,600 plus 15 percent of the excess
over P68,000.
Bracket 4: Those earning over P160,000 but not over P320,000
would pay an excess tax of P19,400 plus 20 percent of the
excess over P160,000.
Bracket 5: Those earning over P320,000 but not over P570,000
would pay a fixed tax of P51,400 plus 25 percent of the excess
over P320,000.
Bracket 6: Those earning over P570,000 but not over P1.2
million would pay a fixed tax of P114,000 plus 30 percent of the
excess over P570,000.

Bracket 7: Those earning over P1.2 million would pay a fixed tax
of P300,000 plus 32 percent of the excess over P1.2 million.
(Senate of the Philippines)
Works Cited
"Angara Files New Income Tax Reform Bill Pegging Tax Rates to
Inflation." Senate of the Philippines. Senate of the Philippines, 6 Nov.
2015. Web. 27 Nov. 2015.
<https://www.senate.gov.ph/press_release/2015/1106_angara1.asp>.
"Asia: Table of Tax Comparison." Business-in-Asia.com. Runckel &
Associates, Inc., n.d. Web. 26 Nov. 2015.
"Marikina Rep. Quimbo: Bill Lowering Income Tax Rates to Be Approved in
Oct." Politiko Luzon. Politiko Luzon, n.d. Web. 27 Nov. 2015.
"Palace: No New or Higher Taxes, Income Tax Cuts." Rappler. Rappler.com,
5 Sept. 2015. Web. 26 Nov. 2015.
"Palace: No New or Higher Taxes, Income Tax Cuts." Rappler. Rappler.com,
5 Sept. 2015. Web. 27 Nov. 2015.