SENATE President Sherwin Gatchalian has renewed his call for the immediate passage of the proposed Granting Increase in Take-home Pay for All Working Filipinos (Ginhawa) Act, saying persistent inflation continues to erode workers' purchasing power and place additional strain on small businesses.
Gatchalian appealed for the release of the latest inflation data, which showed that while headline inflation eased to 6.4 percent in June, core inflation — which excludes volatile food and energy prices — rose to 4.4 percent, marking its sixth consecutive monthly increase and its highest level since November 2023.
"While headline inflation has eased, rising core inflation shows that price pressures remain. The prices of many basic goods and services continue to rise. This means that workers are taking home less for their families and putting a heavier burden on small businesses," Gatchalian said.
The Senate leader said the continued increase in the cost of essential goods and services underscores the need for tax relief measures that would immediately increase workers' disposable income while providing incentives for employers to retain and hire more workers.
Under Senate Bill (SB) 56, or the proposed Ginhawa Act, the annual income tax exemption threshold would be increased from P250,000 to P400,000, allowing more Filipino workers to keep a larger portion of their earnings. The bill also seeks to raise the ceiling on tax-free bonuses and other benefits from P90,000 to P150,000.
In addition to providing relief to employees, the measure aims to support micro and small enterprises by allowing them to claim an additional tax deduction equivalent to 50 percent of their labor expenses. The incentive would apply to businesses such as sari-sari stores, laundry shops, home-based salons, food stalls, and small online sellers.
Gatchalian said the proposal seeks to strike a balance between helping workers cope with the rising cost of living and enabling small businesses to manage labor costs amid ongoing economic challenges.
The Ginhawa bill is among several proposed tax reform measures pending in Congress to ease the financial burden on Filipino families while promoting employment and economic recovery.
