Senator Win Gatchalian urged the Department of Finance (DOF) and the Bureau of Internal Revenue (BIR) to give their proposals on how poll workers, including public school teachers, can receive the full amount of their honoraria, allowances, and other benefits.
“I am appealing to the DOF and to the BIR if they can give us a proposal on how we can give the full amount to our teachers. Pareho naman yung ating sentimyento na dapat tulungan yung ating mga teachers, so let’s just find a way to give them the full amount,” said Gatchalian during a Senate panel hearing on the proposed tax exemption on poll workers’ honoraria and other benefits.
Gatchalian filed Senate Bill No. 1193, which seeks to make the honoraria, travel allowance, and other benefits granted to poll workers exempt from tax. It also seeks to exclude poll workers’ honoraria and allowances from gross income.
The election honoraria and allowances of poll workers, including public school teachers, have never been subjected to tax until the 2018 Barangay and SK Elections and the 2019 midterm elections when the BIR imposed a 5 percent withholding tax on their honoraria. For the upcoming 2022 national elections, they will be taxed 20%.
While recognizing the intent to help poll workers and public school teachers, the DOF said that it does not support the proposal to grant tax exemption on their honoraria and other benefits.
Citing a previous ruling from the BIR, the DOF said that poll workers’ honoraria and other allowances, no matter the amount, are wealth that flow into the hands of the recipients and should be subject to income tax.
The DOF also said that the proposed tax exemption is counter to the principles of the Tax Reform for Acceleration and Inclusion (TRAIN) Law to make the tax system more efficient and equitable. The agency added that the tax system is not the best way to provide additional benefits to sectors, noting that it could be difficult to implement and could be subject to abuse.
Gatchalian, however, noted that the tax code already provides for different tax exemptions. The 13th month pay, for example, is exempt from tax. When he quizzed the DOF on how the proposed measure will cause inefficiencies in the tax system, the lawmaker also emphasized that elections are only held every three years.
“Exempting them from 20 percent withholding tax is a small recognition for their sacrifice and a small recognition for the extra mile that they demonstrated for our country in terms of assuring democracy,” Gatchalian emphasized.