INTRODUCTION

Despite the efforts that the National Internal Revenue Code has done for the

Philippines, the country still fails to manage to meet its annually budgeted revenue

from tax collection. Tax rates are high relative to tbe country's ASEAN neighbors yet

revenue productivity remains low (R. G. Manasan 2017). Filipino taxpayers are

always burdened by their annual income tax. It's an intriguing situation and many

issues have risen because of the effectiveness of NIRC, because despite of the hight

tax rates, the country can still not managed to meet its requirements on tax revenue.

Due to these issues and questions about the old tax reform, the Duterte

administration has proposed a simpler, more efficient, and more equitable tax

system that will not just help the low income-earning Filipinos but will also simplify

the computation of taxes in the Philippines. The

Tax Reform for Acceleration and Inclusion (TRAIN) Law is the new tax reform law

in the Philippines that was signed by President Rodrigo R. Duterte last December 19,

2017. This new tax reform law supersedes and contains amendments for several

provisions of the National Internal Revenue Code of 1997 (NIRC 1997). The

redesigned tax system is envisioned to be characterized by low rates and a broad

base to promote investments, job creation, higher and sustained growth, and

poverty reduction (R.G. Manasan, 2017).

The arrival of the TRAIN law comes with lots of questions. The amendment of

the TRAIN Law raises lots of controversies, starting from the exemption of middle
income-earners, effects on inflation rate up to the excise tax impose to primary

commodities. It is to be noted that excise tax on sweetened beverages has drastically

raised and the administration said that it is for tbe health of every Filipinos to stop or

minimize the consumption of junk foods. This is only one of the few issues that the

TRAIN law have created

This study reports the findings of a thorough research to establish the factors of

having a new tax reform in the Philippines and how it affects selected manufacturing

industries around Metro Manila. Emphasis is placed on the management's decision

making and what strategies they made to adapt to this new tax reform law.

Package 1 of the administration's Comprehensive Tax Reform Program was filed

as house Bill (HB) no. 4774 in January 2017. Titled "Tax reform for acceleration and

inclusiin" (TRAIN), HB 4774 seeks to: (i) repeal current provisions on the personal

income tax (i. e., address brackrt creep, shift to a modified gross income PIT

regime for simplicity, and reduced the top marginal rate to 25% over time); (ii)

broaden the base of thr value-added tax (i. e., by eliminatung a number of

exemptions and limiting zero-rating ti durect exporters); (iii) increasr the excise tax

on petroleum products and automobiled; and (iv) reduce the estate tax and the

donor's tax. (R. G. Manasan).