C.

INCLUSIONS AND EXCLUSIONS FROM GROSS INCOME * Other definitions of Gross Income

DEFINITION OF GROSS INCOME 1. Personal income may be defined as the algebraic sum of:

* Gross income under the NIRC a) the market value of rights exercised in consumption; and

b) the change in value of the store or property rights between

SECTION 32. GROSS INCOME. –
the beginning and the end of the period in question
(A) General Definition. - Except when otherwise provided in this Title, 2. The gain derived from capital, from labor, or from both combined
gross income means all income derived from whatever source, including (Eisner v. Macomber)
(but not limited to) the following items:

(1) Compensation for services in whatever form paid, including,

but not limited to fees, salaries, wages, commissions, and similar items; * Test to determine the Income (Commissioner v. Glenshaw)

(2) Gross income derived from the conduct of trade or business or 1. Is it an accession to wealth - is a person richer?
the exercise of a profession;
2. Is the wealth clearly realized - has some event happened that such
(3) Gains derived from dealings in property; person has received money?

(4) Interests; 3. Does the person receiving the money have compete dominion over it

(5) Rents; note: Section 32 of the NIRC follows this test

(6) Royalties;

(7) Dividends; EXCLUSIONS FROM GROSS INCOME

(8) Annuities; * SECTION. 32 (B) Exclusions from Gross Income. - The following
items shall not be included in gross income and shall be exempt from
(9) Prizes and winnings;
taxation under this Title:
(10) Pensions; and
(1) Life Insurance. - The proceeds of life insurance policies paid to
(11) Partner's distributive share from the net income of the general the heirs or beneficiaries upon the death of the insured, whether in a single
professional partnership. sum or otherwise, but if such amounts are held by the insurer under an
agreement to pay interest thereon, the interest payments shall be included
note: Everything which falls under this definition is part of gross income.
BUT, that does not necessarily mean that it is taxable in gross income.
 (2) Amount Received by Insured as Return of Premium. - The
amount received by the insured, as a return of premiums paid by him
under life insurance, endowment, or annuity contracts, either during the
term or at the maturity of the term mentioned in the contract or upon
surrender of the contract.
(3) Gifts, Bequests, and Devises. - The value of property acquired
by gift, bequest, devise, or descent: Provided, however, That income from
such property, as well as gift, bequest, devise or descent of income from
any property, in cases of transfers of divided interest, shall be included in
gross income.
(4) Compensation for Injuries or Sickness. - amounts received,
through Accident or Health Insurance or under Workmen's Compensation
Acts, as compensation for personal injuries or sickness, plus the amounts
of any damages received, whether by suit or agreement, on account of
such injuries or sickness.
(5) Income Exempt under Treaty. - Income of any kind, to the
extent required by any treaty obligation binding upon the Government of
the Philippines.
(6) Retirement Benefits, Pensions, Gratuities, etc.-
a. Retirement benefits received under Republic Act No. 7641 and
those received by officials and employees of private firms, whether
individual or corporate, in accordance with a reasonable private benefit
plan maintained by the employer: Provided, That the retiring official or
employee has been in the service of the same employer for at least ten
(10) years and is not less than fifty (50) years of age at the time of his
retirement: Provided, further, That the benefits granted under this
subparagraph shall be availed of by an official or employee only once. For
purposes of this Subsection, the term 'reasonable private benefit plan'
means a pension, gratuity, stock bonus or profit-sharing plan maintained
by an employer for the benefit of some or all of his officials or employees,
wherein contributions are made by such employer for the officials or
employees, or both, for the purpose of distributing to such officials and
employees the earnings and principal of the fund thus accumulated, and
wherein its is provided in said plan that at no time shall any part of the
corpus or income of the fund be used for, or be diverted to, any purpose
other than for the exclusive benefit of the said officials and employees.
b. Any amount received by an official or employee or by his heirs
from the employer as a consequence of separation of such official or
employee from the service of the employer because of death sickness or
other physical disability or for any cause beyond the control of the said
official or employee.
c. The provisions of any existing law to the contrary
notwithstanding, social security benefits, retirement gratuities, pensions
and other similar benefits received by resident or nonresident citizens of
the Philippines or aliens who come to reside permanently in the
Philippines from foreign government agencies and other institutions,
private or public.
d. Payments of benefits due or to become due to any person
residing in the Philippines under the laws of the United States
administered by the United States Veterans Administration.
e. Benefits received from or enjoyed under the Social Security
System in accordance with the provisions of Republic Act No. 8282.
f. Benefits received from the GSIS under Republic Act No. 8291,
including retirement gratuity received by government officials and
employees.
(7) Miscellaneous Items. –
a. Income Derived by Foreign Government. - Income derived from
investments in the Philippines in loans, stocks, bonds or other domestic
securities, or from interest on deposits in banks in the Philippines by (i)
foreign governments, (ii) financing institutions owned, controlled, or
enjoying refinancing from foreign governments, and (iii) international or
regional financial institutions established by foreign governments.
b. Income Derived by the Government or its Political Subdivisions.
- Income derived from any public utility or from the exercise of any
essential governmental function accruing to the Government of the
Philippines or to any political subdivision thereof.
c. Prizes and Awards. - Prizes and awards made primarily in
recognition of religious, charitable, scientific, educational, artistic, literary,
or civic achievement but only if:
(i) The recipient was selected without any action on his part
to enter the contest or proceeding; and
(ii) The recipient is not required to render substantial future
services as a condition to receiving the prize or award.
d. Prizes and Awards in sports Competition. - All prizes and
awards granted to athletes in local and international sports competitions
and tournaments whether held in the Philippines or abroad and sanctioned
by their national sports associations.
e. 13 th Month Pay and Other Benefits. - Gross benefits received
by officials and employees of public and private entities: Provided,
however, That the total exclusion under this subparagraph shall not
exceed Ninety thousand pesos (P90,000) which shall cover:
(i) Benefits received by officials and employees of the national
and local government pursuant to Republic Act No. 6686;
(ii) Benefits received by employees pursuant to Presidential
Decree No. 851, as amended by Memorandum Order No.
28, dated August 13, 1986;
(iii) Benefits received by officials and employees not
covered by Presidential Decree No. 851, as
amended by Memorandum Order No. 28, dated August
13, 1986; and
(iv) Other benefits such as productivity incentives
and Christmas bonus. (as amended by RA No 10963)
f. GSIS, SSS, Medicare and Other Contributions. - GSIS, SSS,
Medicare and Pag-Ibig contributions, and union dues of individuals.
g. Gains from the Sale of Bonds, Debentures or other Certificate
of Indebtedness. - Gains realized from the same or exchange or retirement
of bonds, debentures or other certificate of indebtedness with a maturity of
more than five (5) years.
h. Gains from Redemption of Shares in Mutual Fund. - Gains
realized by the investor upon redemption of shares of stock in a mutual
fund company as defined in Section 22 (BB) of this Code.
* SECTION. 61. TAXABLE INCOME. – The taxable income of the estate
or trust shall be computed in the same manner and on the same basis as
in the case of an individual, except that:
(A) There shall be allowed as a deduction in computing the
taxable income of the estate or trust the amount of the income of the
estate or trust for the taxable year which is to be distributed currently by
the fiduciary to the beneficiaries, and the amount of the income collected
by a guardian of an infant which is to be held or distributed as the court
may direct, but the amount so allowed as a deduction shall be included in
computing the taxable income of the beneficiaries, whether distributed to
them or not. Any amount allowed as a deduction under this Subsection
shall not be allowed as a deduction under Subsection (B) of this Section in
the same or any succeeding taxable year.
 (B) In the case of income received by estates of deceased
persons during the period of administration or settlement of the estate, and
in the case of income which, in the discretion of the fiduciary, may be
either distributed to the beneficiary or accumulated, there shall be allowed
as an additional deduction in computing the taxable income of the estate
or trust the amount of the income of the estate or trust for its taxable year,
which is properly paid or credited during such year to any legatee, heir or
beneficiary but the amount so allowed as a deduction shall be included in
computing the taxable income of the legatee, heir or beneficiary.
(C) In the case of a trust administered in a foreign country, the
deductions mentioned in Subsections (A) and (B) of this Section shall not
be allowed: Provided, That the amount of any income included in the
return of said trust shall not be included in computing the income of the
beneficiaries.
SECTION. 62. EXEMPTIONS ALLOWED TO ESTATE AND TRUSTS. -
(as amended by RA No 10963)
SECTION. 63. REVOCABLE TRUSTS. – Where at any time the power to
revest in the grantor title to any part of the corpus of the trust is vested
SECTION. 64. INCOME FOR BENEFIT OF GRANTOR. –
(A) Where any part of the income of a trust
(1) is, or in the discretion of the grantor or of any person not
having a substantial adverse interest in the disposition of such part of the
income may be held or accumulated for future distribution to the grantor,
or
(2) may, or in the discretion of the grantor or of any person not
having a substantial adverse interest in the disposition of such part of the
income, be distributed to the grantor, or
(3) is, or in the discretion of the grantor or of any person not
having a substantial adverse interest in the disposition of such part of the
income may be applied to the payment of premiums upon policies of
insurance on the life of the grantor, such part of the income of the trust
shall be included in computing the taxable income of the grantor.
(B) As used in this Section, the term 'in the discretion of the grantor'
means in the discretion of the grantor, either alone or in conjunction with
any person not having a substantial adverse interest in the disposition of
the part of the income in question.

(1) in the grantor either alone or in conjunction with any person not
having a substantial adverse interest in the disposition of such part of the
corpus or the income therefrom, or
* REVENUE REGULATION 2-98 –  Increasing the Withholding Tax
(2) in any person not having a substantial adverse interest in the
Rates on Certain Income Payments 
disposition of such part of the corpus or the income therefrom, the income
of such part of the trust shall be included in computing the taxable income Salient features:
of the grantor.
1. Income payments to certain contractors from 2% to 4%
2. Income payments to certain brokers and agents from 10% to 15% if the 8. Payments made to embalmers from 1% to 4%
gross income exceeds P720,000 and 10% if otherwise
9. Income payments made by the top five thousand (5,000) Individual
3. Certain income payments made by credit card companies Taxpayers to their local/resident suppliers of goods and local/resident
from 1% to 2% supplier of services other than those covered by other rates of withholding
tax
4. Income payments made by the top twenty thousand (20,000) private
corporations to their local/resident supplier of goods and local/resident a. Supplier of goods – from 1% to 2%
supplier of services other than those covered by other rates of withholding
tax: b. Supplier of services – from 2% to 4%

a. Supplier of goods – from 1% to 2% c. Purchases involving agricultural products in their original

state – 2% in excess of P300,000 within same year
b. Supplier of services – from 2% to 4%

c. Purchases involving agricultural products in their original

state – 2% in excess of P300,000 within same year note: The BIR issued REVENUE REGULATIONS 11-2018, amending RR
2-98
5. Income payments made by the government to its local/resident supplier
of goods and local/resident supplier of services other than those covered Type of Income Old CWT Rate New CWT Rate
by other rates of withholding tax, except casual or single purchase of Payment
P1o,000 and below: 1. Professional Fees,
Talent Fees, etc. for a. INDIVIDUAL – 8% a. INDIVIDUAL
a. Supplier of goods – from 1% to 2% services rendered
b. NON INDIVIDUAL gross income does not
2. Professional fees
b. Supplier of services – from 2% to 4% – 10% or 15% exceed 3 million – 5%
paid to medical
practitioners by
c. Purchases involving agricultural products in their original gross income exceeds
hospitals and clinics or
state – 2% in excess of P300,000 within same year 3 million – 10%
paid directly by Health
Maintenance
6. Commission of Indepent and/or exclusive sales representatives, and b. NON INDIVIDUAL
Organizations (HMO)
marketing agents of companies from 10% to 15% if the gross income and/or similar
gross income does not
exceeds P720,000 and 10% if otherwise establish-ments
exceed 720,000 –
10%
7. Payments made by pre-need companies to funeral parlors
from 1% to 4%
3. Income payments to sickness or other physical disability or for any cause beyond the control of
certain brokers and gross income has the said official or employee, any amount received by him or by his heirs
agents exceeded 720,000 from the employer as a consequence of such separation shall likewise be
– 15% exempt as hereinabove provided. The term "reasonable private benefit
4. Commission of
independent and/or plan" means a pension, gratuity, stock bonus or profit sharing plan
exclusive sales maintained by an employer for the benefit of some or all of his officials and
representatives or employees, wherein contributions are made by such employer or officials
marketing agents of and employees, or both, for the purpose of distributing to such officials and
companies
employees the earnings and principal of the fund thus accumulated, and
5. Income distribution 8% 15%
wherein it is provided in said plan that at no time shall any part of the
to beneficiaries
corpus or income of the fund be used for, or be diverted to, any purpose
6. Income payments to 8% gross income does not other than for the exclusive benefit of the said officials and employees.
partners of GPPs exceed 720,000 – (June 17, 1967)
10%
gross income has
exceeds 720,000 –
15% * REPUBLIC ACT NO. 7641 – An Act Granting Retirement Benefits to
* REPUBLIC ACT NO. 4917 – An Act Providing that Retirement Private Sector Employees in Absence of Qualified Plan
Benefits of Employees of Private Firms shall NOT be subject to
Attachment, Levy, Execution, or any tax whatsoever In the absence of a retirement plan or agreement providing for
retirement benefits of employees in the establishment, an employee upon
The retirement benefits received by officials and employees of reaching the age of 60 years or more, but not beyond 65 years which is
private firms, whether individual or corporate, in accordance with a hereby declared the compulsory retirement age, who has served at least
reasonable private benefit plan maintained by the employer shall be five (5) years in the said establishment, may retire and shall be entitled to
exempt from all taxes and shall not be liable to attachment, garnishment, retirement pay equivalent to at least one-half (1/2) month salary for every
levy or seizure by or under any legal or equitable process whatsoever year of service, a fraction of at least six (6) months being considered as
except to pay a debt of the official or employee concerned to the private one whole year. Unless the parties provide for broader inclusions, the term
benefit plan or that arising from liability imposed in a criminal action: one half (1/2) month salary shall mean fifteen (15) days plus one-twelfth
Provided, That the retiring official or employee has been in the service of (1/12) of the 13th month pay and the cash equivalent of not more than five
the same employer for at least 10 yrs and is not less than 50 yrs of age at (5) days of service incentive leaves. Retail, service and agricultural
the time of his retirement: Provided, further, establishments or operations employing not more than (10) employees or
workers are exempted from the coverage of this provision. (December 9,
That the benefits granted under this Act shall be availed of by an 1992)
official or employee only once: Provided, finally, That in case of separation
of an official or employee from the service of the employer due to death,
EXCLUSION OF THE 13TH MONTH PAY
* REPUBLIC ACT NO. 7833 – An Act to Exclude the Benefits
Mandated under RA 6686 and PD 851 and other benefits from the
computation of Gross Compensation Income for determining Taxable
Compensation
A new sub-paragraph to be known as sub-paragraph (F) is hereby
inserted at the end of Section 28(b)(8) of the National Internal Revenue
Code, as amended, which shall read as follows:
(F) 13th month pay and other benefits –
(i) Benefits received by officials and employees of the national and
local governments pursuant to Republic Act No. 6686;
(ii) Benefits received by employees pursuant to Presidential
Decree No. 851, as amended by Presidential Memorandum Order No. 28
dated August 13, 1986 (requiring all employers to pay all their rank-and-file
employees a 13th month pay not later than December 24 of every year);
(iii) Benefits received by officials and employees not covered by
P.D. No. 851, as amended; and
(iv) Other benefits such as productivity incentives and Christmas
bonus in an amount not exceeding P12,000.00 which shall be integrated in
the 13th month pay solely for purposes of R.A. No. 7833. Provided,
however, that the exclusion shall only apply to the first P30,000.00.
note: Salient Features of the law
1. The benefits received by officials and employees of both public (national
and local) and private offices, viz: (F) 13th month pay and other benefits.
a. Annual Christmas bonus equivalent to one (1) month basic
salary and additional cash gift of One Thousand Pesos (P1,000.00)
received by National and Local Government officials and employees
starting CY 1988 in accordance with R.A. No. 6686;
b. Benefits received by employees pursuant to P.D. No. 851,
as amended by Presidential Memorandum Order No. 28 dated
August 13, 1986 requiring all employers to pay all their rank-andfile
employees a 13th month pay not later than December 24 of every year;
c. Benefits received by officials and employees not covered
by P.D. No. 851, as amended; and
d. Other benefits such as productivity incentives and
Christmas bonus in an amount not exceeding Twelve
Thousand Pesos (P12,000.00) which shall be integrated in
the 13th month pay solely for purposes of R.A. No. 7833.
were taxable compensation income under Section 21(a) in
relation to Section 72, both of the NIRC, as amended, subject to
withholding tax under Revenue Regulations No. 6-82, as amended by
Revenue Regulations No. 4-93.
2. Under sub-paragraph (F) of Section 28 (b) (8) of the NIRC, asamended
by R.A. No. 7833, the 13th month pay and other benefits aforestated,
received by officials and employees of the National Government, LGUs
and agencies, including GOCCs, as well as by officials and employees of
private corporations and entities, are exempt from income tax, and
consequently from the withholding tax on wages. Provided, that
the exclusions/exemptions from gross compensation income shall
cover the 13th month pay and "other benefits" in the aggregate amount not
exceeding P30,000 received by the officials and employees paid or
accrued beginning January 1, 1994. (April 17, 1998)
* REVENUE REGULATIONS NO. 2-95: Implementing Republic Act No.
7833, An Act to Exclude the Benefits Mandated Pursuant to Republic
Act No. 6686 and Presidential Decree No. 851, as Amended, and other
Benefits from the Computation of Gross Compensation Income for
the Purposes of Determining Taxable Compensation Income –
Pursuant to Section 245 and 72 of the NIRC, as amended, in relation to
Section 3 of Republic Act No. 7833, these Regulations are hereby
promulgated to implement the provisions of Section 28 (b) (9) (6) of the
NIRC, as amended, excluding from the computation of gross
compensation income, for purposes of determining taxable compensation
income, the 13th month pay and other benefits.
Definition of Terms. — For purposes of these Regulations, the following
definitions of words and phrases are hereby adopted:
b) "Exclusions" — shall mean the total benefits which are not
included in the computation of gross compensation income for purposes of
determining taxable compensation income and are, therefore, exempt from
the withholding tax on wages.
c) "Gross compensation income" — means all remunerations for
services performed by an employee for his employer, whether paid in cash
or in kind, unless specifically excluded under Secs. 27 and 28 of the NIRC,
as amended.
e) "Other benefits" — refer to all benefits other than the 13th
month pay, such as, the annual Christmas bonus given by private offices,
14th month pay, mid-year productivity incentive bonus, gifts in cash or in
kind and other similar benefits received by an official or employee for one
calendar year in an amount not exceeding Twelve Thousand Pesos
(P12,000.00) as maximum limit.
g) "13th month pay" — refers to the mandatory one month basic
salary of an official or employee of the National Government, Local
Government Units, agencies and instrumentalities, including government-
owned and -controlled corporations, and of private offices received after
the 12th month pay.
Benefits Exempted from Income Tax. — For purposes of determining
the taxable compensation income, the following benefits shall be excluded
from the gross compensation income, viz:
a) 13th month pay equivalent to the mandatory 1 mo. basic salary
of officials and employees of the Government (whether national or local),
including GOCCs, and of private offices received after the 12th month pay
beginning CY 1994; and
b) Other benefits, such as, Christmas bonus given by, private
offices to their officials and employees, productivity incentives bonus,
loyalty award, gifts in cash or in kind and other benefits of similar nature
actually received by officials and employees of both Government and
private offices in an amount not exceeding P12,000.00 for 1 calendar year.
The above-stated exclusions [(a) and (b)] shall cover benefits paid or
accrued beginning January 1, 1994 but shall be limited only to an amount
not exceeding P12,000.00 in the case of the "other benefits" contemplated
under paragraph (b) above, provided, however, that when added to the
13th month pay, the total amount of tax exempt benefits shall not exceed
P30,000.00.
Refund/Credit of Taxes Withheld from employees Separated from
Employment. —
a) An employee separate from the service of his previous
employer but is presently employed by another employer shall be
refunded/credited the taxes withheld on his exempt 13th month pay and
other benefits by his present employer.
(b) An employee who has been separated from a previous
employer but has no present employment shall claim his refund of excess
tax withheld on his 13th month pay and other benefits by filing with the BIR
a refundable income tax return for CY 1994, provided that the refundable
ITR for 1994 reflects the taxes withheld on his 13th month pay and other
benefits.
Concurrent Multiple Employments. — An employee is employed by two
or more employers at the same time during the taxable year shall be
refunded/credited the taxes withheld on his 13th month pay and "other
benefits" by his main employer, e.g., the employer paying the highest
wage/salary. The said main employer shall determine the maximum
allowable 13th month pay and "other benefits" received from both main
and secondary employer/s in annualizing the taxable compensation
income at year-end adjustment. For this purpose, the secondary
employer/s shall furnish the main employer a certification as to the amount
of the 13th month pay and other benefits received by the employee.
* REVENUE MEMORANDUM CIRCULAR NO. 36-94
Publishing the full text of Republic Act No. 7833 - an Act excluding the
benefits mandated pursuant to Republic Act No. 6686 and Presidential
Decree No. 851, as amended, and other benefits from the computation of
gross compensation income for purposes of determining taxable
compensation income, amending for the purpose Section 28 (b) (8) of the
National Internal Revenue Code, as amended. (December 14, 1994 )
* REVENUE REGULATIONS No. 02-98 SECTION 2.78.1. Withholding
of Income Tax on Compensation Income. —
(B) Exemptions from withholding tax on compensation. — The following
income payments are exempted from the requirement of withholding tax
on compensation:
(11) Thirteenth (13th ) month pay and other benefits. —
(a) Thirteenth (13th) month pay equivalent to the mandatory one
(1) month basic salary of officials and employees of the government,
(whether national or local), including government-owned or controlled
corporations, and or private offices received after the twelfth (12th) month
pay; and
(b) Other benefits such as Christmas bonus, productivity incentive
bonus, loyalty award, gifts in cash or in kind and other benefits of similar
nature actually received by officials and employees of both government
and private offices.
The above stated exclusions (a) and (b) shall cover benefits paid or
accrued during the year provided that the total amount shall not exceed
thirty thousand pesos (P30,000.00) which may be increased through rules
and regulations issued by the Secretary of Finance, upon recommendation
of the Commissioner, after considering, among others, the effect on the
same of the inflation rate at the end of the taxable year.
* REPUBLIC ACT NO. 7459: Investors and Invention Incentives Act of
the Philippines Tax Incentives. —
Inventors, as certified by the Filipino Inventors Society and duly
confirmed by the Screening Committee, shall be exempt from payment of
license fees, permit fees and other business taxes in the development of
their particular inventions. This is an exception to the taxing power of the
local government units. The certification shall state that the manufacture of
the invention is made on a commercial scale. Inventors shall exempt from
paying any fees involved in their application for registration of their
inventions.
Tax Exemption. — To promote, encourage, develop and
accelerate commercialization of technologies developed by local
researchers or adapted locally from foreign sources including inventions,
any income derived from these technologies shall be exempted from all
kinds of taxes during the first ten (10) years from the date of the first sale,
subject to the rules and regulations of the Department of Finance:
Provided, that this tax exemption privilege pertaining to invention shall be
extended to the legal heir or assignee upon the death of the inventor. The
technologies, their manufacture or sale, shall also be exempt from
payment of license, permit fees, customs duties and charges on imports.
(Approved: April 28, 1992)
1. Minimum wage earners shall be exempt from income tax on their
taxable income including holiday pay, overtime, night shift differential pay,
and hazard pay
2. Increases the amount of personal exemption for all individuals to a fixed
amount of P50,000.00 and the additional exemption to P25,000.00 for
each dependent, not exceeding four (4)
3. Amends Section 34(L) to increase to 40% of gross sales or receipts the
Operational Standard Deduction (OSD) allowed to individuals (except
nonresident aliens) engaged in business or earning income in the exercise
of their profession
4. Now allows corporations (except nonresident foreign corporations) to
claim OSD, instead of itemized deductions, in an amount not exceeding
40% of their gross income

EXEMPTION OF MINIMUM WAGE EARNERS

* REPUBLIC ACT NO. 9504 – An Act Amending Sections 22, 24, 34, * REVENUE REGULATIONS 10-2008
35, 51, AND 79 of the NIRC
Section 1 (13)
SEC. 22. Definitions. — When used in this Title:
a. RA 9504, July 6, 2008 b. RR 10-2008, Sept 25, 2008
(GG) The term ‘statutory minimum wage’ shall refer to the rate fixed by
the Regional Tripartite Wage and Productivity Board, as defined by the
Bureau of Labor and Employment Statistics (BLES) of the Department of
Labor and Employment (DOLE).

“(HH) The term ‘minimum wage earner’ shall refer to a worker in the
private sector paid the statutory minimum wage, or to an employee in the
public sector with compensation income of not more than the statutory
minimum wage in the non-agricultural sector where he/she is assigned.

note: Salient Features of the Law