"Our discussion with the employers and workers’ groups led us to a consensus that the government should look into a congressional amendment of existing laws to possibly exempt all minimum wage earners from (paying) income tax," Labor Undersecretary Manuel Imson said.
The DOLE recently hosted a forum with various employers and labor groups for the purpose of coming out with a new tax system that is less burdensome for workers.
At the forum, participants agreed on the need to provide tax relief for workers and suggested a congressional amendment of the tax law, Imson said.
"The suggested amendments would hopefully meet our objective of lessening the burden on our workers," he said.
Imson added that the Department of Finance (DOF) is currently undertaking studies on possible congressional amendments and a tax credit scheme.
But until the law is amended, businesses and workers should abide by the existing laws, he said.
The government is looking into a transitional tax relief mechanism for workers while Congress draws up a new tax system.
"The DOF is answering the need to unburden workers from inflation and the increase in transportation (costs) that could come by way of review of existing regulations which can be done at the executive level," Imson assured.
Both employers and workers have been pushing for an income tax cut to improve the workers’ lot.
The Trade Union Congress of the Philippines (TUCP), the country’s largest labor union, said tax relief would provide a greater respite for workers than a wage increase.
Thousands of Filipinos working in Japan as entertainers lost their jobs after Japan stopped recognizing a certificate issued by the Philippine Overseas Employment Administration as a valid travel document. Tokyo had declined Manila’s request to defer the new immigration policy.
Albay Rep. Edcel Lagman, who chairs the special committee on overseas Filipino workers, will preside over the hearing.
Eastern Samar Rep. Marcelino Libanan had sought an audience with the Japanese ambassador to discuss the issue.
The welfare of Filipino migrant workers is a sensitive political issue for the government.
The Philippines depends heavily on the money they remit to their families back home — which reaches at least $7 billion annually — to prop up the country’s sluggish economy.
Their contribution and sacrifices have prompted the government to declare them as the Philippines’ modern-day heroes.
Last year, President Arroyo risked anger from the United States and other Western allies in July when she pulled out the country’s small troop contingent in Iraq after militants threatened to execute truck driver Angelo de la Cruz, who was being held captive.