As a means of highlighting the government’s tax incentives for both employers ang employees, the Bangko Sentral ng Pilipinas (BSP) is urging businesses to promote the Personal Equity and Retirement Account (PERA) program which will help workers to save and invest more while also benefiting from improved employee satisfaction and retention.
According to BSP deputy governor Lyn Javier, PERA would benefit the country’s workforce ias a voluntary retirement savings program that would supplement state-sponsored pension systems, such as the Social Security System (SSS) and the Government Service Insurance SYSTEM (GSIS).
On the other hand, private employers that match or exceed PERA contributions for qualified employees may claim tax deductions equal to 150 percent of the employer’s share, consisting of a 100 percent tax deduction under the PERA law and an additional 50 percent incentive under the Capital Markets Efficiency Promotion Act.
Javier explained that under PERA accounts, employees can invest in stocks, bonds, funds and other products that are exempt from a range of taxes even as locally employed and self-employed individuals may invest up to ₱200,000 per year. Overseas Filipinos may contribute up to ₱400,000 annually.
This year in April, East West Banking Corporation became the first universal bank to launch an employer-sponsored PERA program with voluntary enrollment. The BSP is encouraging other banks and corporations to follow suit by adopting similar programs.
The BSP asserted that beyond retirement savings, it sees PERA as a way to broaden the investor base and deepen the capital market and likewise channel savings into productive investments that supports financial stability and sustainable economic growth.
