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House committee approves tax breaks for companies hiring elderly workers

THE HOUSE Committee on Ways and Means approved tax measures on Monday that hope to encourage companies to provide work opportunities for older persons and former inmates via the grant of tax holidays for taking on such workers.

In a hearing Monday, the House tax panel approved the tax provisions with amendments for the unnumbered substitute bills that will, if passed, become the Former Prisoners Employment Act and the Mature or Older Workers Job Training Act.

The proposed Former Prisoners Employment Act consolidated House Bills No. 2774, 3322, 6044 and 6637 which will provide private-sector establishments incentives to hire former persons deprived of liberty (PDLs) to improve their chances of finding work.

The approved tax provision will grant businesses that employ former inmates a deduction from their gross income equivalent to 15% of the total salaries paid to former PDLs “provided, however that such employment shall continue for a period of at least six months: provided further that the annual threshold of income of the former prisoners shall be determined by the Department of Labor and Employment (DoLE) in consultation with the National Economic and Development Authority (NEDA) for that year.”

Albay Rep. Jose Ma. Clemente S. Salceda said in a statement Monday that the committee wants to improve the bill further to avoid potential employer abuse of PDL hires adding: “Under the current formulation, it’s very easy to hire, fire, and rehire PDLs to take advantage of deductions every year. We want a more airtight bill so that we can get this enacted.”

The panel also approved the tax provisions of the unnumbered substitute bill that will if approved become the Mature or Older Workers Job Training Act. The bill consolidated House Bills No. 1863, 1892, 4333 and 8349 which propose the creation of a job training program for workers over 40 years old who are unemployed; whose income does not exceed the poverty line; who have finished less than 10 years of schooling; or are homeless.

The committee approved a deduction from gross income for businesses that hire such workers equivalent to 15% of the total salaries paid to the mature workers provided that the employment lasts for at least six months, with the annual threshold of income determined by the DoLE and NEDA.

Separately, a bill proposing to cut taxes imposed on the honoraria and allowances of teachers serving as members of the Board of Election Inspectors hurdled committee on Monday.

Mr. Salceda said if the bill becomes law, it will result in the loss of about P56.8 million in withheld taxes, which he described as not threatening to the government’s revenue position. — Gillian M. Cortez

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