Dahil papalapit na ang filing ng ITRs, napasulat ako ng isang income tax related letter sa Inquirer. Sana maprint at sana may sumuporta:
More than a decade ago, an individual with an annual income of just over half a million pesos may be considered rich. Nowadays, it would be ridiculous to consider a midlevel manager earning a gross income of P50,000 a month in league with tycoons like Henry Sy and Jaime Zobel de Ayala. But that is precisely what our current Tax Code implies, since the said manager is classified, along with the billionaires in society, in the topmost income bracket for income tax purposes.
The progressive income tax system which we adopted in this country works on the principle that those with greater means or ability has greater responsibility in bearing the costs of society. It is supposed to be a just system which tempers wealth and income inequality. However, a tax system which is progressive in form is not progressive in substance if it classifies an individual who can not earn enough income to buy his own house in the same league as a rich individual who lives in a gated high-walled exclusive village in Makati. Our current income tax system is so out-of-touch with reality that a professional or a call-center agent with only three to four years of experience already qualifies for the second highest income bracket and is asked to pay an income tax rate that is just 2% away from the maximum individual income tax rate (30% vs. 32%).
The current Tax Code was legislated way back in 1997 even before the Asian financial crisis. The decrease in purchasing power of the Philippine peso and the increase in cost of living since the law was passed has definitely made the individual income tax brackets outdated. I believe it is time for legislators to reexamine and adjust the income tax brackets in our Tax Code to make it more middle-class friendly and for it to serve its progressive intent. This is not just an issue of providing economic relief. It is also an issue of economic justice.