Tax on luxury goods

February 8, 2023 People's Tonight 149 views

A PROPOSED piece of legislation seeking to raise the tax on luxury goods and non-essential items is pending consideration in the House of Representatives.

Authored by Albay Rep. Joey Salceda, House Bill (HB) No. 6993 adjusts the said tax from the current 20 percent to 25 percent and expand the list of luxury goods.

And the scenario has now a new twist, with the reported support of President Marcos to the proposed measure.

“So palagay ko naman, it’s reasonable that we will tax the consumption side of those consuming luxury items,” the Chief Executive from Ilocos Norte was quoted as saying last Tuesday.

Under Section 150 of the “National Internal Revenue Code of the Philippines,” a 20-percent tax on the price of jewelry, perfumes and yatchs is imposed.

HB No. 6993 of Salceda, chairman of the House committee on ways and means, imposes a 25-percent tax on wristwatches, bags, wallets and belts worth over P50,000.

Also covered by proposed law are the sale of real property valued at over P100,000 per square meter; beverages above P20,000 per bottle; antiques worth more than P100,000; paintings worth P1 million; and brand new or secondhand automobiles valued at more than P10 million.

In supporting the bill, Marcos stressed the need to expand the coverage of tax imposition to more luxury items.

“Tama naman ‘yan dahil kahit tumataas ang presyo ng mga bilihin ay tuloy pa ring bumibili ng mga mayayamang Pilipino ng mga mamahaling bagay,” according to observers.

It’s certainly a move in the right direction.