KMU says P82k tax cap a case of ‘too little, too late’

Nov. 28, 2014

DAVAO CITY – The militant labor center Kilusang Mayo Uno said on Friday that majority of the country’s workers won’t benefit from the Senate-approved tax exemption on the 13th month pay, saying it is a case of “too little, too late.”

“Increasing the tax cap would not give any economic relief to the majority of Filipino workers who have long been subjected to poverty wages and widespread contractual employment,” said Elmer Labog, KMU chairperson.

KMU claimed that “due to various violations of the minimum wage and the widespread contractualization of work forces, only 20 percent of the country’s total work force would be covered by the new cap on tax exemption”.

“Even for those who would gain from the bill, the case is one of too little, too late,” Labog said.

But for an ordinary middle class worker, he said that the tax cap “wouldn’t do any enormous change to alleviate the economic plight that most Filipinos are encountering daily—expensive basic commodities and services”.

Nilo Alvarado, 35, an employee of a lending firm, said the passage of the bill, “will be less felt by the workers because the prices of basic goods and services are steadily increasing.”

“Ordinary workers won’t benefit from it, only those people who hold managerial positions because not all workers have huge bonuses and 13th month pay,” he added.

“It’s too cheap for senators to legislate a law such as SB 2437 that clearly it’s them or those who are rich will only benefit from it using the plight of poor workers to advance their agenda. Cleverly done,” remarked Alvarado.

Senate Bill 2437 seeks to increase tax exemption ceiling of the 13th month pay and other bonuses to P82,000 from the current level of P30,000. The bill is authored by Senator Ralph Recto and sponsored by Senator Sonny Angara.

Kilusang Mayo Uno said that legislators “should heed workers’ demands for a national minimum wage of P16,000 per month and for the criminalization of contractualization as an employment scheme.”

Labog said however, that government is “trying to evade from these demands”.

“Politicians are only presenting nice-sounding palliatives to poverty and hunger in an attempt to boost their popularity ratings,” the KMU said.

Bayan Muna Rep. Neri Colmenares warned that proposed tax exemptions may have a bearing on the 2016 Presidential elections.

“The Filipino people are unjustly overtaxed for years now because the tax rates have been static for years, and which taxes the poor more than the rich. This is compounded by the fact that taxes do not go back to the people but are misappropriated or stolen by corrupt officials. The people will certainly not vote or support anyone who blocks efforts to equitably adjust tax exemptions, including President Aquino,” warned Colmenares in an emailed statement.

The labor center said it would to intensify their call for the two workers’ demands. (

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