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NTRC TRJ: Tax Contribution of Women on Wage Employment

The study examines the participation of men and women in wage employment and determine their contribution to income tax collection. To uphold the State’s recognition of the role of women in nation building, the government embarked on gender and development (GAD) as one of its priority programs. The principle that development is for all and that everyone in society, female or male, has the right to equal opportunities to achieve a full and satisfying life to be able to contribute to development is the very heart of GAD. To support this principle, the Philippine Commission on Women (PCW) (formerly National Commission on the Role of Filipino Women-NCRFW), formulated the 1995-2020 Philippine Plan for Gender-Responsive Development (PPGD) which was approved by the President via Executive Order (EO) No. 273 on September 8, 1995. Accordingly, all agencies are mandated to institutionalize GAD in government by incorporating the GAD concerns spelled out in the PPGD in their planning, programming and budgeting processes. To carry out and implement the programs outlined in the PPGD, the General Appropriations Act (GAA) since then allotted annually at least 5% of government agencies’ total budget appropriation for the cost of implementing their respective GAD Plans. In 2000, the government, along with other member countries of United Nations (UN), adopted the Millennium Declaration which brought forth eight (8) Millennium Development Goals (MDGs). The third MDG centers on the promotion of gender equality and women empowerment the target of which is to increase the share of women in wage employment in the non-agricultural sector. Based on the data from the Bureau of Labor and Employment Statistics (BLES), there were a total of 37.6 million employed persons in 2012 of whom, 22.8 million male and 14.8 million female, or a share of 61% and 39% to total employment, respectively. During the same period, wage and salary workers represented more than half of the country’s total employed persons. Of the total wage and salary earners, about 62% were male and 38% were female. In the non-agricultural sector, about 58% are men and 42%, women. By industry (excluding agriculture, hunting and forestry and fishing), men dominated construction (98%); mining and quarrying (94%); transport, storage and communication sectors (90%). On the other hand, women took the lead in private households (85%); education (75%); and health and social work (72%). It was only in hotels and restaurants that men and women had an almost equal share in the number of employment. Based on 3,150,596 sample compensation income tax filers gathered from the BIR which represented about 28% of the total BIR-registered compensation income earners as of December 2012, male tax filers outnumbered women in case of single and married tax filers. Also, the number of dependents of male tax filers exceeded those of female tax filers. There were more married men with dependents possibly due to the fact that husbands are deemed the proper claimant of the additional exemption in respect to dependent children, unless he explicitly waives his right in favor of his wife in claiming the additional exemption. As pointed out in a previous gender-related NTRC study conducted in 2000, it is believed that it was never the intention of the Tax Code to put women taxpayers in unequal footing with men taxpayers with regard to the claim for additional exemption for qualified dependents. The exclusive right to claim the additional exemption was given to the husbands since they are the usual claimants of the additional exemptions. Moreover, it was made in an effort to eliminate the malpractice of some employed husband and wives where both claim additional exemption allowances for their dependents in their respective income tax returns. However, it is still acknowledged that there is a need to eliminate this form of gender bias in the income tax provision of the Tax Code. The total income tax collection from wage and salary earners amounted to PhP181.6 billion in 2012. Based on the sample compensation income tax filers, it is estimated that men contributed 60% and women, 40% to the total tax collection. By status, 51% of the collections from single tax filers were from male and 49% were from female single tax filers; 44% from male heads of family and 56% from female heads of family tax filers; 59% from male married tax filers and 41% from female married tax filers; and 56% from male with zero exemption and 44% from female tax filers. The figures reveal the gap between male and female share in employment and tax contribution. The continuous collection of gender statistics by the NSO/BLES is supported in order to monitor the progress in achieving the goal of promoting gender equality. It is also recommended that sex-disaggregated data on tax collection be regularly produced and collected by the BIR to be used in studies not only on personal income tax, but also on other types of taxes.

National Tax Research Center
Authors Keywords
NTRC; wage employment; income tax ;
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