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2018 Income Tax Table in the Philippines

Pursuant to the new TRAIN law that was recently approved, a new income tax table was implemented by the Bureau of Internal Revenue or BIR effective January 1, 2018. The objective of the new TRAIN law is to reduce the tax rates, expand the VAT base, excise tax on petroleum products, automobiles and sugary products as well as simplify the tax system.

In addition, the Department of Finance also intend to implement tax reforms on general tax amnesty, estate tax amnesty, lower estate and donor’s tax rates, amendments to bank secrecy law, limit the VAT zero-rating to direct exporters, reduce the rates on transaction taxes on land, VAT refund in cash, rationalization of fiscal incentives, synchronization of capital income tax rates on investments, deposits, equities, dividends and other passive income and increase the tax rate on stock transaction to 1%.


The Package 1 of the TRAIN has started in 2018 and the Package 2 will be implemented this year to 2019. The Packages 3 and 4 along with other tax measures will be implemented soon.

Read also: DTI for Business Name Registration

The new Income Tax table for 2018

The BIR has created a new Income Tax table that will guide taxpayers about the tax rate corresponding to their annual income. It will be implemented from January 1, 2018 to December 31, 2022.

Range of Taxable Income Tax Due = a +(b x c)
Over Not Over Basic Amount (a) Additional rate (b) Of Excess Over (c)
250,000 400,00 20% 250,000
400,000 800,000 30,000 25% 400,000
800,000 2,000,000 130,000 30% 800,000
2,000,000 8,000,000 490,000 32% 2,000,000
8,000,000 2,410,000 35% 8,000,000


According to the TRAIN law, those workers earning minimum wage are exempted from paying the income tax. In the same manner, the overtime pay, holiday pay, hazard pay and night shift differential pay received by those minimum wage earners are also exempted.

For further information about the TRAIN law, you can visit the official website of BIR.

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