The Marcos administration is assessing the feasibility of Senator Erwin Tulfo’s proposal for a one-month tax holiday, Special Assistant to the President for Investment and Economic Affairs Secretary Frederick Go said Thursday.
Go said the suggestion is “quite a big matter” and must be thoroughly reviewed by both the Department of Finance (DOF) and the Department of Budget and Management (DBM).
“This is quite a big matter, and I think it’s best to give the DOF and the DBM time to carefully study this proposal,” Go said during a Palace press briefing.
The idea of a tax holiday has been floated as a possible way to boost public confidence amid ongoing concerns over the anomalous flood control project mess.
Asked whether he supports the logic behind the proposal, Go declined to take a position and reiterated the need for due diligence.
“I’d like to defer this matter to the Department of Finance and the DBM because this really has to be studied carefully,” he said.
“I would hesitate to make a response that’s probably not very well thought about,” Go added.
Tulfo recently filed Senate Bill No. 1446, or the “One-Month Tax Holiday of 2025,” which aims to grant a one-time income tax exemption for Filipino workers.
The tax break would apply to one payroll month following the bill’s approval, covering only compensation income. Mandatory contributions and loan deductions would still apply.
“Because of the recent revelations about alleged ghost flood control projects worth billions of pesos from public funds, the people have lost trust in the government. The Filipino people’s call is clear: ‘Return the people’s money. Lower the taxes’” said Tulfo.
The proposed legislation would allow employees earning compensation income to enjoy a one-time income tax exemption for one month following the bill’s approval.
The tax exemption will apply only to compensation income, while individuals with mixed income sources will receive relief solely on the salaried portion of their earnings.
Mandatory contributions to the Government Service Insurance System, Social Security System, PhilHealth, and Pag-IBIG Fund will remain unaffected.
The measure also excludes loan amortizations and other employee-authorized deductions that are voluntary in nature.
A “non-diminution clause” in the bill ensures that employers cannot reduce or adjust employees’ pay due to the temporary tax holiday.
“While we recognize that taxation is the source of the government’s funds, we must also acknowledge that these funds ultimately come from the people themselves,” he said.
The senator clarified that the measure is a symbolic but meaningful way to acknowledge the sacrifices of ordinary Filipinos who continue to shoulder the country’s financial burdens.
