The Department of Finance (DOF) said it has begun nationwide consultations on the proposed Promoting Growth, Revenue, and Equity toward Socioeconomic Sustainability (ProGRESS) bill, which seeks to refine a tax reform package that combines tax relief with new revenue measures.

In his State of the Nation Address last July, President Ferdinand R. Marcos Jr. proposed exempting employees earning up to P350,000 annually from paying income tax while reducing tax rates for those in higher income brackets to provide relief for middle-income earners.

He also urged lawmakers to approve a tax amnesty covering unpaid income, estate, donor’s, and value-added taxes, including the corresponding penalties.

“So, to ensure the continued progress of the middle class amidst the lingering effects of the crisis, we will pursue tax relief measures that promote growth, generate revenue, and advance equity toward socio-economic sustainability,” Marcos said.

The DOF said on Thursday that the ProGRESS bill seeks to increase disposable income by adjusting the personal income tax system while providing tax relief to micro and small businesses. The proposal also includes new or expanded taxes intended to offset the revenue losses from these measures.

Part of the proposed changes is raising the personal income tax exemption threshold from P250,000 to P350,000 annually, as the President proposed in his SONA. The DOF added that the measure also seeks to exempt micro and small enterprises from the minimum corporate income tax.

Finance officials have said the package is designed to address declining purchasing power and provide greater take-home pay, particularly for middle-income workers. The government has estimated that the package could generate about P518.71 billion in revenues from 2027 to 2030, translating to around P191.77 billion in net revenues after accounting for the tax relief measures.

The DOF said it will consult with various stakeholders across the country, and it will consider their feedback as it refines the bill.

“We will continue to dialogue with our stakeholders and carefully consider their concerns as we refine ProGRESS. Our goal is for the final legislation to strike the right balance—support our people and businesses, strengthen our fiscal position, and build a more inclusive and resilient economy,” DOF-Fiscal Policy and Monitoring Group (FPMG) Undersecretary Karlo Fermin Adriano said.

President Marcos has called for the measure to be passed within the year, although the proposal remains under review by the DOF. The Palace has said the administration intends to ensure that the reforms do not add to the burden of ordinary Filipinos.

The ProGRESS bill is also among the administration’s priority legislative measures.