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TRAIN LAW - Salient features

Some relevant and important facts about the TRAIN law:

Title of the law:

This Act shall be known as the “Tax Reform for Acceleration and Inclusion” [1]

Known as:

“TRAIN LAW”

Date the law was signed:

19 December 2017

Date of Effectivity:

January 1, 2018
 
“This Act shall take effect on January 1, 2018 following its complete publication in the Official Gazette or in at least one (1) newspaper of general circulation. [2]

What's new in this law?

It introduces Significant and MAJOR Amendments to the NIRC of 1997 [3], are now in place, particularly:
  1. Personal Income tax rates
  2. Passive incomes
  3. Estate tax
  4. Donor’s tax
  5. VAT by expanding the tax base
  6. Removal of VAT exemptions
  7. Adjustments on Excise tax of Fuel. Automobiles, coal,
  8. Documentary Stamps tax
  9. New tax impose on sweetened beverages
  10. New tax impose on cosmetic procedure (non-essential services)
Salient Features (distinguishing features):
  1. Has 87 Sections.
  2. It REPEALED Sections 35, [4] 62 [5] and 89 [6] of Tax code (NIRC of 1997) [7]
  3. It AMENDED Sections 5, 6, 24, 25, 27, 31, 32, 33, 34, 51, 52, 56, 57, 58, 74, 79, 84, 86, 90, 91, 97, 99, 100, 101, 106, 107, 108, 109, 110, 112, 114, 116, 127, 128, 129, 145, 148, 149, 151, 155, 171, 174, 175, 177, 178, 179, 180, 181, 182, 183, 186, 188, 189, 190, 191, 192, 193, 194, 195, 196, 197, 232, 236, 237, 249, 254, 264, 269, and 288;
  4. It CREATED new sections, thus: Sections 51-A, 148-A, 150-A, 150-B, 237-A, 264-A, 264-B, and 265-A.
  5. Forty eight (48) exemptions from VAT under Special Law are now subject to VAT [8]
Footnotes:

[1] Sec. 1 of RA 10963
[2] Sec. 87 of RA 10963
[3] National internal Revenue Code of 1997, Republic Act 8428
[4] See Section 35 of NIRC (National internal Revenue Code of 1997, Republic Act 8428), Allowance of Personal Exemption for Individual Taxpayer.
[5] Section 62. Exemption Allowed to Estates and Trusts. - For the purpose of the tax provided for in this Title, there shall be allowed an exemption of Twenty thousand pesos (P20,000) from the income of the estate or trust.
[6] Section 89. Notice of Death to be Filed. - In all cases of transfers subject to tax, or where, though exempt from tax, the gross value of the estate exceeds Twenty thousand pesos (P20,000), the executor, administrator or any of the legal heirs, as the case may be, within two (2) months after the decedent's death, or within a like period after qualifying as such executor or administrator, shall give a written notice thereof to the Commissioner.
[7] See Section 86 of TRAIN law (RA 10963) Repealing Clause,
[8] See Section 86 of TRAIN law (RA 10963) Repealing Clause,
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