What It Means
- Ejercito’s SB 2341 proposes an income tax exemption threshold of ₱600,000, well above the ₱350,000 figure most of the Senate has settled on.
- Sotto’s SB 2338 and the administration’s own Progress Bill both sit at ₱350,000, the number the Department of Finance already costed at ₱66 billion a year.
- Ejercito filed two additional bills the same week targeting electricity costs, alongside his tax exemption push.
- No cost estimate exists yet for the ₱600,000 version, even though Ejercito chairs the Senate Finance Committee that will eventually reconcile both numbers.
Sen. JV Ejercito wants Filipinos earning up to ₱50,000 a month exempt from income tax entirely. That would put the income tax exemption threshold nearly ₱250,000 above where most of his colleagues have landed, and it arrives without a price tag from the department that will have to defend whichever figure survives.
Senate Bill No. 2341 seeks to raise the income tax exemption threshold from ₱250,000 to ₱600,000, replacing the ceiling set under the TRAIN Law in 2017. Citing the Philippine Statistics Authority’s 2024 Labor Force Survey, Ejercito’s office points to 17.6 million full-time private sector workers earning below that mark who would benefit. His bill also proposes a new graduated schedule, taxing income between ₱600,000 and ₱2 million at 15 percent. Ejercito said the measure is meant for middle-income earners who keep paying taxes even as the cost of living climbs.
What Each Proposal Actually Changes
The income tax exemption threshold is not a single number that flips a switch. It marks where a graduated bracket system starts applying, and each proposal moves that starting point differently.
Under the current TRAIN Law schedule, someone earning exactly ₱250,000 owes nothing. Someone earning ₱250,001 does not suddenly owe tax on the full amount. Only that one extra peso gets taxed, at 15 percent, which comes out to a few centavos. The system taxes income in slices, not as a cliff.
| Annual Income | Current Law (TRAIN, since 2023) | Sotto / Progress Bill (SB 2338) | Ejercito’s Proposal (SB 2341) |
|---|---|---|---|
| Up to ₱250,000 | Exempt, 0% | Exempt, 0% | Exempt, 0% |
| ₱250,001 | 15% of the ₱1 excess | Exempt | Exempt |
| ₱250,001 to ₱350,000 | 15% of excess over ₱250,000 | Exempt | Exempt |
| ₱350,001 to ₱400,000 | 15% of excess over ₱250,000 | Not detailed in reporting so far | Exempt |
| ₱400,001 to ₱600,000 | ₱22,500 + 20% of excess over ₱400,000 | Not detailed in reporting so far | Exempt |
| ₱600,001 to ₱800,000 | ₱22,500 + 20% of excess over ₱400,000 | Not detailed in reporting so far | New 15% bracket on excess over ₱600,000 |
| ₱800,001 to ₱2,000,000 | ₱102,500 + 25% of excess over ₱800,000 | Not detailed in reporting so far | New 15% bracket continues to ₱2,000,000 |
| Above ₱2,000,000 | ₱402,500 + 30% of excess over ₱2,000,000; ₱2,202,500 + 35% above ₱8,000,000 | Not detailed in reporting so far | Not detailed in Ejercito’s filed version |
Sotto’s SB 2338 and the Progress Bill raise the starting point to ₱350,000 but have not detailed changes to the brackets above it, based on what has been reported so far. Ejercito’s SB 2341 goes further on both ends, raising the starting point to ₱600,000 and inserting a new 15 percent bracket that runs all the way to ₱2 million, a wider low-rate band than either the current law or the ₱350,000 proposals offer.
The Senate Has Already Converged Elsewhere
Before Ejercito filed his version, Senate President Pro Tempore Vicente Sotto III introduced SB 2338, proposing an income tax exemption threshold of ₱350,000, the same figure President Marcos called for in his SONA under the so called Progress Bill. Finance Secretary Frederick Go priced that package directly: raising the income tax exemption threshold to ₱350,000 costs the government roughly ₱60 billion a year, with another ₱6 billion lost from exempting small businesses from the minimum corporate income tax. Go said the package would benefit at least 3.13 million workers and push the total number of tax exempt workers from 5.1 million to 6.3 million.
That ₱66 billion figure is now the reference point every other proposal on the income tax exemption threshold gets measured against. Ejercito’s bill sits outside that reference point entirely, since no comparable estimate has been published for his ₱600,000 version.
A House Proposal Sits Between the Two
The Senate is not alone in debating where the income tax exemption threshold should land. A House measure separately proposes ₱480,000, positioned between the Sotto and Progress Bill figure and Ejercito’s ask. Congressional Policy and Budget Research Department officials have said the goal across these competing proposals is relief that does not undermine the government’s fiscal position, a standard none of the higher figures has actually been tested against yet. Three different numbers now sit in active legislative discussion at once, each with its own backers and its own silence on cost.
Sen. JV Ejercito Is Moving on Multiple Fronts at Once
The income tax exemption threshold bill did not arrive alone. Ejercito also filed SB 2342, which would bar distribution utilities from passing system loss charges to consumers, and SB 2343, which would abolish the 12 percent VAT on electricity bills. All three measures followed Marcos’s SONA call to bring down electricity and tax burdens for ordinary households. Taken together, they show where Ejercito has chosen to put his legislative output this cycle, spanning both tax relief and power costs at once, rather than concentrating on a single bill.
The Chairperson Problem
Ejercito’s position matters here in a way it would not for an ordinary member filing a bill. As Senate Finance Committee chairperson, he presides over the same committee that must eventually weigh his proposed income tax exemption threshold against Sotto’s costed figure and decide what reaches the floor. Committee chairs file bills routinely, and that alone is not unusual. What stands out is that the highest, least costed number in the current field came from the senator overseeing the very process that will reconcile it against the alternatives.
The Department of Finance has not yet said what a ₱600,000 income tax exemption threshold would cost the treasury. Until that estimate exists, the ₱66 billion figure attached to the smaller package remains the only hard number in the room, and it belongs to a bill that is not the one Ejercito is championing.
The case for the higher number is not weak. A ₱600,000 income tax exemption threshold would reach nearly three times as many workers as the ₱350,000 version, based on the PSA figures Ejercito cites, and would deliver more relief per household in a year where inflation on basic goods has outpaced wage growth for a large share of private sector employees. That is a real trade lawmakers have to weigh, not a bill filed for show.
Whichever version of the income tax exemption threshold gets priced first will likely shape where the compromise settles. The ₱350,000 figure already carries a ₱66 billion answer. The ₱600,000 figure still does not.
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