Manila: The passage of the Promoting Growth, Revenue, and Equity towards Socio-Economic Sustainability (ProGRESS) proposed bill is anticipated to significantly increase the take-home pay of Filipinos, thus boosting household spending, according to Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio Balisacan.

According to Philippines News Agency, the Department of Finance's (DOF) ProGRESS bill seeks to increase the personal income tax exemption from PHP250,000 to PHP350,000. It also aims to exempt micro and small enterprises from the minimum corporate income tax. Data from the DOF indicates that over six million Filipino workers are expected to benefit from the increased personal income tax exemption threshold. Additionally, more than 70,000 micro and small enterprises (MSEs) are anticipated to gain relief from the proposed minimum corporate income tax exemption.

The DOF projects that individuals earning an annual income between PHP250,000 and PHP350,000 will see up to PHP15,000 more in their annual net income or take-home pay. Meanwhile, those earning PHP350,000 and above could receive up to PHP17,500 more in income tax relief, translating to increased annual take-home pay.

Balisacan emphasized that this increase in take-home pay is expected to stimulate spending. However, he noted that recent data from the Philippine Statistics Authority showed a slowdown in household final consumption expenditure, growing by only 2.8 percent in the second quarter, compared to the 5.2 percent growth in the same quarter of 2025. This decrease in domestic consumption is attributed to high inflation and declining consumer confidence.

Balisacan highlighted the importance of fostering consumer and business confidence to ensure that citizens view the future optimistically and understand that high prices are not a permanent issue.

While the ProGRESS bill proposes higher taxes on sweetened beverages and tobacco, Balisacan asserted that this will not be inflationary. To counterbalance potential revenue losses from higher income tax exemptions, the DOF suggests increasing the sweetened beverage tax to PHP20 per liter for sugar and PHP40 per liter for high-fructose corn syrup. Balisacan pointed out that sweetened beverages constitute a small portion of the consumption basket.