In the Philippines at present, earning a salary, binge-watching your favorite series, saving for the future — or even selling property —

comes with one constant: the taxman quietly taking his share.

Whether you’re an office worker, a content creator, or a property seller, the government now touches almost every peso that flows through your hands — and often before you even see it.

Under the Tax Reform for Acceleration and Inclusion (TRAIN) law, workers earning up to P250,000 annually remain exempt from income tax. But once income crosses that line, rates start at 15 percent and reach up to 35 percent for top earners. A Filipino earning P300,000 per year now pays roughly P625 per month in income tax. At P360,000, the monthly bite more than doubles to P1,375.

Beyond income tax, mandatory contributions further reduce take-home pay. Employees are required to contribute nearly 8 percent of their salary to government programs: 4.5 percent to the Social Security System (SSS), 2.25 percent to PhilHealth, and 1 percent to Pag-IBIG. These are deducted alongside taxes, with employers paying their separate share.

For a middle-income employee earning between P25,000 and P30,000 a month, the impact is significant.

Between P2,500 and P3,700 is deducted monthly in taxes and social contributions, adding up to P30,000 to P44,000 annually. These deductions apply even before spending on rent, food, or transportation, long before consumption taxes kick in.

Savings? Still taxed

Even traditional savings vehicles are no longer spared. As of 1 July, all bank deposits — regardless of maturity or currency — are subject to a 20 percent final withholding tax (FWT) on interest income. Long-term deposits that were once exempt are now fully taxable. Banks quietly withhold a fifth of the earnings before they reach depositors’ accounts.

This shift has prompted many middle-class Filipinos to question traditional saving strategies.

“I understand that taxes are necessary to fund essential public services, and I respect the government’s effort to create a more uniform tax system,” said Dr. Arvin Tan, a medical officer III.

“However, like many others, I can clearly see how the new taxes — especially the 20 percent uniform tax on interest income — will impact my take-home pay and savings. It’s a noticeable adjustment, especially for those of us who are simply trying to secure a modest future.”

For some, the tax discourages saving through banks altogether.

“I think this will prompt ordinary savers to rethink how they save for retirement,” said Pau Salonga, an associate for investments and business development. “Instead of time deposits, they might move toward government-backed investment schemes like Pag-IBIG MP2, which are tax-exempt.”

The concern extends to equity. While high-net-worth individuals can diversify into mutual funds, real estate, or offshore assets, many working-class Filipinos rely on low-risk, fixed-income instruments to slowly build a retirement fund.

“This tax might unintentionally discourage saving, particularly through time deposits or regular savings accounts,” Tan said. “While the wealthy can afford higher-yield investments, many Filipinos depend on safe, fixed-income options to build their future.”

“For ordinary savers — not millionaires, but responsible citizens trying to build financial security — this tax can feel disheartening,” he added. “I hope that as these policies evolve, our leaders consider ways to protect and incentivize grassroots saving. Responsible saving should be encouraged, not penalized.”

Salonga, while not yet moving funds, acknowledged the shift. “The tax rate now plays a bigger role in my financial decisions. It has narrowed my viable investment options.”

Selling? Still taxed

Selling property? There’s no escape. A 6 percent capital gains tax applies to the higher of the zonal value or selling price of land or real estate. On top of that, there’s a 1.5 percent documentary stamp tax. Exemptions exist — for instance, when proceeds are reinvested in a new primary residence — but come with tight deadlines and complex requirements.

Even your digital life isn’t tax-free.

Watching Netflix? Playing mobile games? Running a Facebook ad campaign? Since 1 June, all digital services accessed in the Philippines —whether from local apps or global tech giants — are subject to the standard 12 percent value-added tax (VAT).

Under the new rules, platforms like Amazon, Google, Apple and Spotify are required to register with the Bureau of Internal Revenue and directly collect VAT from Filipino users. Local businesses using foreign digital tools must self-withhold and remit VAT under a “reverse charge” system.

What was once a tax system focused mainly on physical goods and traditional income now shadows Filipinos across the full spectrum of economic activity, from salaries and savings to streaming and selling.

Critics argue that the expanding reach of taxation hits the middle class hardest, especially as wages remain flat and inflation continues to rise. The Department of Finance defends the reforms as necessary to raise revenues and reduce reliance on borrowing.