Should Voluntary SSS Contributions Be Taxed?

Apparently, a genius from BIR came up with the idea of taxing voluntary contributions to SSS, GSIS, Pag-IBIG, and PhilHealth. Contributions subject to tax are those above the mandatory minimum contributions. This started July this year.

By law, these contributions are supposed to be exempt from income taxation but as per BIR, this exemption is being abused and so they rolled out a circular which now imposes tax on these contributions. BIR also pointed out that these contributions which are in excess of the mandatory requirement are actually investments and investments are taxable.

I don’t know what to make of this but one thing is clear: the government wants your money!

It’s just sad because BIR has never shown itself to be an effective government entity. Before it can ask for more money from the people, it should prove that money being taxed is money well spent and invested by the government.

How can people open their minds to increased taxation when they feel that their money is going nowhere?

BIR stated that they are actually suffering from a collection shortfall from the last fiscal year. This only indicates that they are ineffective in their collection efforts. And to make up for this shortcoming, they are devising this scheme to tax voluntary contributions – what the hell!?

Instead of heightening measures to run after big time tax evaders, they are running after the little people. Come on BIR, these people who are voluntarily contributing are small time people who are merely trying to salvage a secured future for those they may be leaving behind! They are the people who know that they do not have enough riches to hand down to their children and so they need these pre-need plans and assurances so that someday somehow they may have something for their children.

On the other hand, I believe there should be a positive act from the legislature before taxes can be imposed against these voluntary contributions. The laws that exempt these contributions from taxes are as follows: RA 8291 (GSIS Act), RA 8282 (SSS Law), and RA 9679 (Pag-Ibig Law). These laws, obviously, are enacted by Congress. Only Congress then can amend, revise, repeal, or modify these laws in any other way and NOT by a mere BIR circular.

Anyway, I think someone is cooking to have the said circular debunked. Let’s see what happens next. Until then, I ain’t paying my SSS contribution. I’m a voluntary member by the way.

 

Howard maintains a ranting site here. It’s not a page to make the BLOOD BOIL though; it’s just a page where he tries to debunk the myths and illusions that hover over issues in our country. Howard aims to encourage fellow Pinoys to exercise critique and analysis before accepting popular thoughts and ideas.

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  • another corruption,kawawa naman kaming mga mahihirap sa inyong mga nakaupo
    dapat sa inyo kasama n GMA sa kulungan.Kulang pa ba ang mga milyong milyon na
    sweldo nyo bawat buwan.MAHIYA NAMAN KAYO.

  • blackmamba888

    maaring kapos nga sa pondo ang BIR , ang tanong eh “BAKIT?” , matindi ang kurapsyon at lagayan ng mayayamang negosyante na sa halip na magbayad ng tamang buwis ay naglalagay na lamang at ang mga lagay ay napupunta lang sa mga bulok na mga tax analyst at mga “kumisyoner” na ang ang halagang trenta mil pesos ay pangkape lamang sa kanila.

  • alam mo KIM HENARES, wag mo pag-initan ang mga maralitang filipino! napakarami ng mga businesses na hinde nagbabayad ng tamang buwis, mga mayayamang hinde nagbabayad ng buwis, pati ba naman ang kakarampot na iniipon ng mga manggagawa para sa benepisyo nila kapag tumanda na at sa mga emergencies ay bubuwisan mo pa? NAPAKAWALANG HIYA MO AT WALANG KONSENSYA! tao ka ba?… wag n’yong sagarin sa galit ang mga tao, baka hinde lumaon ay tumakbo ka din palabas ng bansa…

  • christianbagnol

    mr. henares,,, bakit ganon ang naisip nyong way … maraming paraan para umabot sa kuta ang income ng BIR,,, singilin nyo ang mga negosyanteng hindi nagbabayad ng tama,,, kasuhan nyo sila??? wag nyo pagbalingan ang mga mahihirap…
    lagi nyo sinasabi na naaayon sa batas ang pag kaltas ng buwis sa mga mahihirap,,, eh ang mga mayayaman sakop din po ba sila ng batas na sinasabi nyo??? bakit hindi mo sila kasuhan ng kasuhan,,, totoo ba kaya ang kasabihang ang mga mayayaman o mga negosyante ang may batas…

  • elmer

    kawawa naman ang mamamayang Filipino kung babawasan pa ng tax ang kakarampot na ipon ng mga manggagawa, bihira na nga lang ang nakakapag-ipon sa sa panahong ito dahil karamihan ay unemployed or underemployed and those people who are trying to save a small portion of their hard earn income for their own future dahil wala rin naman silang aasahan sa gobyerno even for their basic services that they deserved ay hindi napupunan ng maayos, they will end up discouraged to save which will end up into a dilemma in the funding of our social services system.Dapat nating tandaan na ang ating mga contribution bilang miyembro sa kasalukuyan ang siyang tumutustos sa mga pangangailangan ng mga retired members para sa kanilang retirement funds, medical,housing and other benefits.kung mababawassan ang contribution ng mga paying members now, there will come a time na magkukulang na ang fund to support the retirement ng mga baby boomers who will be retiring soon and their numbers are exponentially increasing mababangkarote ang ating social security system and much worst there will be no more fund left for us when its time for us to retire. If the government is really into raising funds a new taxation is not the answer at this time of economic turmoil but instead the government should run after the corrupt government official at all levels of government who just enriched themselves while in office. Di kaila sa atin ang talamak na pangungurakot ng mga opisyal sa kaban ng bayan. Di na bago sa atin ang mga istorya sa bayan, lungsod o maging sa probinsya man na taon-taon may project si mayor, governor o si congressman para sa daan, tulay o paaralan subalit itoy hanggang sa simula lang at di matapos-tapos dahil paglabas ng pondo ay biglang nawawala ang kagalang-galang na ama ng bayan at nakabakasyon sa amerika,canada o hongkong at pagbalik ay sakay na ng mamahaling sasakyan, ang iba naman ay likas na matulungin kayat inuuna ang kapakanan ng mga minamahal sa buhay kayat ang pondo para sa daan ay naipagpagawa na ng sariling tahanan tsk tsk tsk kaya ang kawawang taong bayan nagtitiis pa rin sa bakobakong daan. The government should be tough and merciless to those who fall short of the law, bawiin ang yaman na dapat mapunta sa bayan, pagmultahin ng triple sa kinurakot na yaman, habulin at parusahan ang nagkasala to the fullest extent of the law para di na pamarisan. God bless the Philippines!!!!!!!

  • NO

  • robert

    what a FUCK! BIR hindi pa ba kayo kontento sa pagiging pinakacorrupt na government agency sa Pilipinas? dagdadagn nyo pa! instead of collecting taxes from our contribution in SSS Pag-ibig Philihealth and GSIS hindi kaya higpitan nyo yung mga collection nyo sa mga mayayaman at malalaking companya para makabawi kayo…ang sa inyo kasi pag binayaran kayo ng malalaking kompanya instead na 10milyon yung tax gawin nalang ninyong 5 milyon or whatever amount man yan kc may under the table na nangyayari malaki pa ang nacollect ng employee/s ng BIR para sa sarili nila kumpara sa ipinapasok na tax sa libro nila….what a hell….

  • Gary Maramag

    Hi Howard,

    What the BIR is taxing is the amount of contribution in excess of the amount mandated by law (regular limit- see SSS schedule of premiums). So please keep paying your SSS contributions up to the regular limit co’z its still tax-free up that point.

    • Yep.. i did point that out in the first paragraph.. the more salient point is the fact that BIR is considering the excess contribution as an investment.. when Congress should be the proper power to do so.. when it comes to taxing matters, Congress is the proper authority.. it defines what should be taxed and what should be not.. the BIR is just an implementing body

      • Gary Maramag

        I agree with you Howard.

        Your statement however, that: “Until then, I ain’t paying my SSS contribution,” might give a wrong impression that people should also stop paying their SSS contributions.

        • Oh.. about that.. my bad, i guess.. But I just feel like since it’s voluntary in the first place, it’s my prerogative to stop when I feel like.. but of course this is not to incite anyone to stop contributing especially if you’re not a voluntary member.. My reservation is of course something personal, because look, if they consider anything above the mandatory requirement as “investment” then there may come a time that all voluntary contributions are labeled “investments” – coz essentially, since it is voluntary it is an excess on the part of the person contributing..

  • It’s a very big no! They already deducting tax from our small salary and then they will try to deduct our small contributions from sss for tax! what the hell is happening in this government! kaya maraming nagigipit eh! pati pera iniimpok nila sa sss papakelamin pa? kung sino man ang may idea niyan balak ata sundin ang yapak ngaun ni GMA.

  • Joel

    I just don’t get it. Here we are ordinary people looking for ways that we will not be a burden for our government when the time comes that we get old or get sick and yet here comes the BIR taxing our SSS, Philhealth, GSIS, PAGIBIG. If we stop paying our contributions to this agencies because they put tax on our contributions will the BIR grant us loans? will the BIR shoulder our hospital bills? They say that taxes are spent on hospitals, then why are some gov’t hospitals doesn’t have the equipment and medicines needed for treating the patients. My goodness BIR should try to think deeply on this matter I still do not hear of big time tax evaders being sent to jail then why run after us? Why run after our contributions? As a Filipino I love my country but my in this situation I feel that my government doesn’t love me.

  • kawawa naman tayong mahihirap

  • Oh and one more thing di na ko nagtataka presidente nga pala natin si Homer Simpson!

  • This a government run by idiots and thieves! bakit kulang na ba ninanakaw nila? kung pwede lang magpalit ng nationality dont get me wrong Im proud to be filipino but the government makes me ashamed to be one!

  • Haay buhay.. Pinagkkakitaan!! Magpasakop n lng kaya tau sa ibang bansa.. Sigurado mkkita natin na umuunlad tayo.. Kesa naman sa gobyerno nating wla ng gnwa kundi magpatong ng kung anu ano! Sbagay bahala na kayo. Malawak pa nmn ung impyerno kasya pa kayo!!! Hahaha

  • this is such a stupid idea..very disappointed !!!

  • tama….gahaman na talaga ang mga yan….buti pa ung totoong crocodile kahit kakatakot kakain lang kung gutum.mga yan kahit impattsuhin pa….

  • lahat nalang pinagkakaperahan ng gobyerno..kulang pa ba ang yaman nyo pati benefits na inaasahan ng mahihirap pagkakakitaan pa ninyo.

  • Why? is there any shortage of fund, that even the private individual money are now being subjected for tax. bakit hindi yong mga nangungurakot ng lantaran ang bigyan ng tax, at least equally divided ang kurakutan

  • victoria m. magtoto

    dapat ang unahin ni kim henares eh singilin nya yung mga mayayaman na nandadaya o kaya eh di nagbabayad ng tamang tax. bakit kaming mga malilit na pinipilit makabayad sa aming voluntary contribution sa sss ang kukuhanan ng tax. napakawala nyang puso.