SEN. Sherwin Gatchalian said tax relief measures are crucial to small businesses amid economic uncertainties resulting from the war in the Middle East.
Gatchalian, vice chairman of the Senate Committee on Ways and Means, said easing the tax burden on small enterprises would help them sustain operations, protect jobs and expand their businesses despite mounting economic pressures.
”If we ease the taxes of small businesses, they will be able to grow their economies and ensure their continued income and jobs for their employees,” he said.
Under the proposed Ginhawa measure, or the Granting Increase in Take-Home Pay for All Working Filipinos Act, microentrepreneurs would be granted an additional deductible expense equivalent to 50 percent of their labor costs.
The proposal is expected to benefit small-scale enterprises such as sari-sari stores, carinderias, laundry shops, tailoring services, food stalls and small e-commerce businesses.
Gatchalian said the measure seeks to provide immediate relief to grassroots enterprises, which are among the most vulnerable sectors during periods of inflation and fuel price increases. Rising oil prices have driven up transportation, electricity and supply costs, placing added strain on small businesses already operating on thin profit margins.
The senator emphasized that lower taxes could encourage more informal businesses to register formally with the government. Formal registration, he noted, would give entrepreneurs greater access to bank financing, government assistance programs and business expansion opportunities, while contributing to broader economic growth.
Under Republic Act 11976, or the Ease of Paying Taxes Act, micro taxpayers are defined as businesses with gross annual sales of less than P3 million.
Economic analysts have noted that micro, small and medium enterprises account for the vast majority of businesses in the Philippines and are considered a key driver of employment and local economic activity. Support measures for the sector are seen as critical amid persistent inflationary pressures and external geopolitical risks affecting global energy markets.
