Understanding the Proposed General Tax Amnesty Act of 2025: What It Means for Taxpayers

Yasser Aureada
Sep 4
3 min read

The Philippine government is taking a significant step toward improving tax compliance and revenue collection through the proposed General Tax Amnesty Act of 2025. Filed in Congress as House Bill No. 2653 by Rep. Kenneth T. Gatchalian, this measure is designed to give taxpayers a fresh start by offering relief from unpaid internal revenue taxes spanning taxable years 2007 to 2024.

For individuals, families, and businesses who may have unresolved tax issues, this upcoming law could be a game-changer. Below, we break down the key features of the bill, its potential impact, and what you should do to prepare.

Key Features of House Bill No. 2653

Coverage:The amnesty covers all national internal revenue taxes such as income tax, withholding tax, capital gains tax, donor’s tax, VAT, excise taxes, and documentary stamp taxes. It applies to unpaid liabilities for 2007–2024, including assessments already issued.

Note: Estate tax cases and certain exceptions (like fraud, tax evasion, or money laundering cases) are excluded.

Payment Options:Taxpayers may choose between:

Paying 2% of total assets as of December 31, 2024; or
Paying 5% of net worth as of December 31, 2024.

Minimum payments apply:

Individuals & estates: ₱100,000
Corporations: ₱150,000 to ₱1.3 million, depending on subscribed capital

Availment Period: Eligible taxpayers will have one year from the effectivity of the Implementing Rules and Regulations (IRR) to apply, either electronically or through authorized collection offices.

Early Availment Incentives:Discounts are available:

20% if paid within the first 3 months
15% if paid within 6 months
10% if paid within 9 months

Immunities and Privileges:Those who avail will be immune from civil, criminal, and administrative cases for covered taxes. Books and records for those years will not be subject to further BIR examination.

Safeguards:

Bank secrecy lifted for one year to allow the BIR to verify disclosures.
Penalties for false declarations: understatement of assets/net worth by 30% or more will nullify the amnesty and expose the taxpayer to penalties.
Confidentiality guarantee: information in the amnesty filings cannot be used against taxpayers in unrelated cases.

Why This Matters for Taxpayers

Fresh Start: Individuals and corporations can settle long-standing tax issues at a fraction of the original liabilities, avoiding years of penalties and interest.
Unlock Assets: Properties and businesses tied up due to unsettled tax obligations can finally be transferred or used productively.
Certainty and Closure: The law provides finality—once availed, past liabilities are settled, and taxpayers can focus on future compliance.
Reduced Stress: Avoiding litigation, enforcement actions, and penalties allows both individuals and businesses to move forward with peace of mind.

Comparison with Previous Tax Amnesties

2007 (RA 9480): Raised ₱5.9 billion in collections, offering relief up to tax year 2005. However, it lacked strong verification measures.
2019 (RA 11213): Limited amnesty (estate tax and delinquencies only) after the general amnesty portion was vetoed due to missing safeguards.
2025 Proposal: Combines broad coverage with stricter controls, addressing weaknesses of past amnesties.

How Businesses and Individuals Should Prepare

Take Inventory of Assets and Liabilities: Gather documentation of your assets (real property, shares, vehicles, etc.) and liabilities as of December 31, 2024.
Evaluate Amnesty Options: Work with your CPA or tax counsel to determine whether the 2% total assets or 5% net worth option is more beneficial.
Plan for Cash Flow: Ensure funds are available to pay the amnesty tax within the one-year period, ideally availing early to maximize discounts.
Seek Professional Guidance: Properly filing the required Statement of Assets, Liabilities, and Net Worth (SALN) is crucial. Errors or omissions could void the amnesty and expose you to penalties.

Our Role as Your CPA-Law Firm

At Aureada CPA Law Firm, we guide clients through complex tax laws and ensure full compliance while minimizing risks. With the General Tax Amnesty Act of 2025 on the horizon, we can help you:

Assess your eligibility and potential benefits under the program
Prepare and file the required amnesty applications and SALNs
Ensure accurate disclosures and protect you from compliance pitfalls
Develop a long-term compliance strategy post-amnesty

Final Thoughts

The proposed General Tax Amnesty Act of 2025 represents both an opportunity and a responsibility. It’s an opportunity to clear the slate, but it also requires careful planning and accurate reporting. If you or your business has unresolved tax obligations from 2007 to 2024, now is the time to act.

Contact our office today to schedule a consultation and let us help you navigate this important tax relief measure with confidence.