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Oct 4, 2016
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We couldn't help but worry after the Department of Finance (DOF) recently pushed to adjust taxes for the 13th month pay and other annual bonuses of working individuals.

Honestly, the idea of taxing the 13th month pay and Christmas bonus of [us] mere employees that earn below P82,000 (the current tax exempt cap) per month is just terrifying.

The DOF's tax reform package has been submitted to Congress. Fortunately, it hasn't been passed yet. If in the future it does, only those who earn a gross income below P250,000 a year are tax-free.

Practically speaking, here are 5 things in your life that might get affected by such measure:


1) Presents will be a thing of the past
We all know how Christmas is the season of giving, but whether it's for you, your family or friends, having less cash means less gifts for everyone.


2) Break the piggy bank
Some depend on their 13th month pay and bonuses to buff up their emergency savings, so taxing the said perks would definitely put a dent in that department.

3) More room for window shopping
When you know that you're about to get at least a month's worth of hard-earned and untaxed salary, you tend to eat out and shop to your heart's delight. Needless to say, settling for cheaper meals and bargain items might be the way to go if the proposal gets approved.


4) Celebrate good times NO MORE
Somehow, December is synonymous to all kinds of celebrations, reunions, and all sorts of gatherings. Taxing bonuses may lead to less reasons to make merry and more reasons to spoil the fun (cancel it).


5) Sometimes, a simple 'I love you' is enough
For those who have special dates other than Christmas day in the last month of the year, getting your extra pay cut means having less wiggle room in celebrating other milestones. Instead of an out-of-town trip, you and your partner might have to settle for some crowded resto during the Christmas rush in the metro.


To put it simply, these taxes equate to everyone having less money to spend. As if we had enough to begin with.

 

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