Bill reduces tax burden on parents.
Manila, Philippines - Pampanga Rep. Gloria Macapagal Arroyo has asked Congress to reduce the tax burdens on parents by lifting the limitation in the number of children to be granted tax exemption and by increasing the allowable exemption for mentally and physically handicapped dependents.
Together with her son, Camarines Sur Rep. Diosdado Macapagal Arroyo, the Pampanga lawmaker filed House Bill 2660 to amend provisions of the National Internal Revenue Code of 1997 that pertains to the grant of additional exemption on taxable income of individual taxpayers.
Currently under hospital detention at the Veterans Memorial Medical Center, Arroyo said the working class should be given breathing space from further economic worries through tax benefits.
"We really hope that the additional exemptions proposed under the bill will be a welcome respite for the unheralded working class who provides the much-needed revenues for the government," said the elder Arroyo.
Under HB 2660, the number of allowable dependents entitled to deduction in taxable income will no longer be limited to four.
The bill grants legitimated children, particularly those legally adopted, the right to be included in the exemptions.
Legally adopted dependents, parents and legal guardians caring for disabled dependents will also be allowed P50,000 tax exempted income.
A dependent parent will also be entitled to P50,000 additional exemption, under the measure.
However, the additional exemption for dependents referred to by the measure could be claimed by only one of spouses in case of married individuals.
Also, in case of legally separated spouses, additional exemption may be claimed only by the spouse who has custody of the child or children.
Under HB 2660, the term dependent refers to "a legitimate, legitimated, illegitimate or legally adopted child chiefly dependent upon and living with the taxpayer if such dependent is not more than 21 years old, unmarried and not gainfully employed or if such dependent, regardless of age, is incapable of self-support because of mental or physical disability."
It also defines a dependent as "a parent or both parents, living with the taxpayer, not gainfully employed and dependent upon the latter for chief support, or where such parents are incapable of self-support because of mental or physical disability or old age."