“We need to channel more resources to the healthcare sector,” Albay Representative Raymond Adrian Salceda said as he filed House Bill No. 7033, a measure seeking to exempt from income tax the benefits received by healthcare workers from the Philippine Health Insurance Corporation (PhilHealth).
Under the bill, PhilHealth benefits—including allowances, hazard pay, performance-based incentives, and health human resource support funds—would be excluded from gross income, placing them on equal footing with benefits from the Government Service Insurance System (GSIS) and Social Security System (SSS).
“GSIS and SSS benefits are already tax-exempt because they are recognized as social protection, not compensation. PhilHealth operates under the same principle. There is no reason to treat it differently,” Salceda explained.
Salceda emphasized that the measure ensures PhilHealth funds intended for healthcare workers reach them in full.
“When PhilHealth allocates money for health human resource support, hazard pay, or performance incentives, the policy intention is to strengthen our healthcare delivery system. Taxing these benefits diverts a portion away from that purpose. The tax exemption ensures that every peso PhilHealth commits to healthcare workers actually goes to healthcare workers,” Salceda said.
The lawmaker noted that the measure effectively increases health sector resources without requiring additional appropriations.
“This is fiscally efficient. We are not asking for new spending. We are simply ensuring that existing health funds are not diluted by taxation before they reach the frontlines. The full value of PhilHealth’s investment in health human resources is preserved,” he added.
Salceda also framed the measure as a complement to Universal Health Care implementation.
“Universal Health Care depends on an adequately supported health workforce. By maximizing the resources that flow to healthcare workers, we strengthen the entire service delivery chain—from barangay health stations to tertiary hospitals. Better-supported workers mean better patient outcomes,” he explained.
Coverage and limitations
The measure covers nurses, midwives, medical technologists, radiologic technologists, physical and occupational therapists, respiratory therapists, pharmacists, nutritionist-dietitians, barangay health workers, and other allied health professionals accredited by or registered with PhilHealth.
The bill clarifies that professional fees for medical, surgical, or other clinical services rendered to patients remain taxable, ensuring the exemption targets social insurance benefits rather than professional income.
If enacted, the Department of Finance shall issue implementing rules within ninety days.
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