Assessing The Impacts of TRAIN Law on Consumption, Savings, and Unemployment in the Philippines
The Tax Reform for Acceleration and Inclusion (TRAIN) policy intends to make the tax system simpler, fairer, and more efficient while also encouraging investments, job creation, and poverty reduction. This tax reform package 1 lowers personal income taxes, removes VAT exemptions, and changes the excise tax on petroleum goods and automobiles, making the tax system more equitable while simultaneously rectifying injustice. This study determines the relationship between the TRAIN Law and the increase in income on the country's consumption, savings, and unemployment rate. Using the multiple regression analysis, this study proves that TRAIN Law and the additional income positively affect consumption. The savings also has a significant positive relationship with the increase in income; however, it has a significant negative relationship with TRAIN Law. This study also shows that while the unemployment rate in the country decreases when income rises, the TRAIN law, on the other hand, relates to the increase in the unemployment rate. The results of this research suggest that the said tax reform has had a considerable beneficial impact on consumption, it has had an adverse influence on the growth rate of savings and unemployment in the country, hence in order to improve the delivery of essential services and better future social and economic results, the government should consider modifying the TRAIN Law and introducing a tax or policy that would stimulate private savings and employment.