Philippines

Individual - Significant developments

Last reviewed - 05 July 2022

Social taxes

Social taxes in the Philippines consist of contributions to the following government agencies:

  • Social Security System (SSS)
  • Philippine Health Insurance Corporation (PhilHealth), and
  • Home Development Mutual Fund (HDMF) or Pag-IBIG Fund

Philippine Health Insurance Corporation (PHIC) or PhilHealth

Under Circular No. 2020-005, beginning 2022, the salary ceiling shall increase by 10,000 Philippine pesos (PHP) (i.e. to PHP 80,000) and the rate by 0.50% (i.e. to 4.00%). Thereafter, there would be an annual increase of PHP 10,000 in the ceiling and 0.50% in the contribution rate until both reach PHP 100,000 and 5.00% by 2025.

While the PHIC had suspended the implementation of the contribution hike, in its latest Advisory No. 2022-0010, PHIC has lifted the suspension and fully implemented the new rate for the year 2022 (i.e. 4%) with retroactive effectivity. Any under contribution in the previous months as a result of the suspension may be adjusted until 31 December 2022.

Business tax

Pursuant to Republic Act (RA) 11534, also known as the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE), any person whose sales or receipts are exempt from the payment of value-added tax (VAT) and who is a non-VAT registered person shall pay a percentage tax equivalent to 1% of one's gross sales or receipts (previously 3%) for the period beginning 1 July 2020 until 30 June 2023.