21 Feb 2018, 14:57 — 2 min read
The TRAIN law basically hinges on the reduction of current personal income taxes of the larger tax-paying public. This is a larger part of the government's move to initiate the biggest tax changes in our old tax structures. The Comprehensive Tax Reform Program or CTRP is the bigger plan to make the current tax regime to a more modern and efficient one.
The biggest impact of the TRAIN law is that there will be higher take-home pay for many of the taxpayers, and this will, in turn, increase private consumption. Simply put, additional money in the pocket of people will translate to either more spending or more opportunities to save or invest. The increase in demand would now then translate to more goods and services that needs to be produced helping the economy grow and expand further.
TRAIN will impact basic take home pay.
Household consumption will continuously grow because of TRAIN (blue line on the left represents household consumption growth).
Article by Ruben Carlo O. Asuncion, UnionBank's Chief Economist
Posted byUnionBank Publication
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