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The Spending Pattern of the Poor – What is Left After Food?
by Dr. Romulo A. Virola ¹
Secretary General, NSCB

The local stock market started the year of the ox with a bang, but the financial crisis that started in America and that has begun to sweep aside and away even  the strong and the mighty including the church  is with us. Loss of jobs for OFWs, retrenchment in the exports industry, reduced income for the call centers, etc. are challenges that must be addressed by both government and the private sector. How do we cope?

Many months back, before the United Nations, the US, and just about everybody else thought of bailouts, tax cuts, stimulus packages, pump priming, doleouts and other solutions to the crisis, Albay Governor Joey Sarte Salceda had proposed a P75 billion package that would have prepared us way in advance for this tsunami. It seems like nobody wanted to listen. Now we worry much more than we probably would have needed to.

Obviously, the global crisis will affect different people differently. Many of us will just have to tighten our belts. Doňa Buding, if you still remember her, may need to cut down on her trips for rejuvenating treatments or her tips to her favorite DIs, or is that now called attorney’s fees? 

At any rate, given the all too real problems we now face, it is worth looking at the way people actually spend for their needs in the hope that planners in government can get a better handle of how to help those who need it the most. Specifically, we will look at the expenditure patterns of the Pinoy families in general and  the bottom 30% and the top 10% in the income distribution. Unfortunately, the public use files (PUFs) of the 2006 Family Income and Expenditure Survey (FIES) that we have do not have the details we need so the discussion will be limited to the years 1997, 2000, and 2003.

The FIES conducted by our National Statistics Office (NSO) every three years has always been a rich source of information.  In addition to the income distribution that the NSO generates from the FIES, the National Statistical Coordination Board (NSCB) uses the FIES as the main data source for our country’s official poverty statistics. Many researchers like Mareng Winnie and Arsi Balisacan depend on the FIES like some of us enjoy watching those knockout punches of Manny Pacquiao who has become a very strong candidate as the Pinoy of the 21st century! The FIES therefore needs to be sufficiently funded by the Department of Budget and Management (DBM) all the time and the NSO should exert its very best efforts to ensure the quality of the data collected. Likewise, the production of comprehensive PUFs on the FIES and its release to the public soonest should be given top priority by the NSO.

So what does the FIES say?

1. Among the regions, the National Capital Region (NCR) has the smallest share (about 1%) of the families with income belonging to the bottom 30% but the largest share (more than 1/3) of families in the top 10% of the income distribution. However, the NCR share of the rich has dwindled from 41.3% in 1997 to 40.3% in 2000 to 35.2% in 2003 (Tables 1 and 2).
   
   

   1.1 Regions VI (Western Visayas) and VII (Central Visayas) have the biggest shares and together account for about 1/5 of the families in the bottom 30%.

   1.2 Caraga and ARMM have the smallest shares (less than 1% each) of families in the top 10%.

   1.3 Calabarzon’s share of rich families is on the rise, from 14.6% in 1997 to 16.9% in 2000 to 19.4% in 2003.

   1.4 The share of the bottom 30% families to total income is only about 10%; that of the top 10% is at least 30%! The good news is that the share of the poor is increasing; that of the rich, decreasing! ( that gives us hope for salvation, doesn’t it?)

2. The family size of families in the bottom 30% is on the average larger by two members than that of families in the top 10% ( 5.7 versus 3.6, Figure 1)
   
   
   
3. As to be expected, food takes the lion’s share of our budget. On the average, however, Filipino families are spending less and less on food, which eats about 43-44% of the budget (Tables 3, 4, and 5, Figures 2 and 3).
   
   
   

   3.1 The percentage allocation of food in the budget of the bottom 30% is more than double that of the top 10% (more than 60% versus less than 30%).

   3.2 While the overall pattern is for decreasing share of food to total expenditure, the top 10% are dangerously allocating more and more, from 27.7% in 1997 to 27.8% in 2000 to 28% in 2003. Food for less thought, maybe?

   3.3 We do not know if it has anything to do with the rice crisis but the proportionate share of rice in the budget of the three groups (all income, bottom 30% and top 10 %) has dwindled.

   3.3.1 Close to 1/5 of the budget of the bottom 30% goes to rice, compared to less than 3% among the top 10%.

   3.3.2 While the bottom 30% generally go for ordinary rice, the top 10% consume ordinary rice almost just as much as special rice.

   3.3.3 NFA is by no means a major source of rice, even among the bottom 30%, who get only about 1/10 of their rice needs from the NFA. 

   3.4 It is not quite true that we are increasingly becoming a country of noodle consumers (its share remains at 0.2%)!

   3.5 And would you believe that the lowly camote had effectively zero share (rounded off) in the budget of the rich? Maybe the rich have not learned to derive joy from the crisis that camote causes?

4. After food, there are three items common to the three groups among the next 4 biggest expenditure items: rent/rental value of occupied dwelling units, transportation and communication, and fuel, light and water. The other item among the top five expenditure items is education  for both the all income group and the top 10%, and personal care and effects for the bottom 30%. (Table 6)
   
   
5. Increasing budgetary shares are seen for fuel, light and water (does Meralco make a lot of profit?); transportation and communication (we cntinue 2 b d txtng cptal of d wrld, don’t we?); personal care and effects (did you notice how much her business had expanded, despite Dra. Belo’s alleged love problems?); and education, particularly among the top 10% (I hope this is not because our schools are charging exorbitant tuition fees!). In 2003, together they accounted for about 22% of total family expenditures of Pinoy families.  (Figures 4, 5, 6, and 7)
   
   
6. On the other hand, the following expenditure items follow decreasing budgetary shares:  alcoholic beverages (no wonder San Miguel has diversified even  into  petroleum and telecommunications while we seem to hear more about Cobra and Virgin Cola than about Beer na Beer?); tobacco (but I still see a lot of smokers in the basement of our building!); rent/rental value of occupied dwelling units, although there is an opposite trend for the bottom 30%;  and taxes. It is nice to know that the proportionate share of expenditures on alcoholic beverages and tobacco is on the decline; but taxes?
   
   
7. We complain a lot about government, but is it right that less than 2% of our income goes to taxes? And that the rich pay only about 4% income tax?  Rough calculations (Tables 7 and 8, Figures 8, 9, 10, and 11) show that the top 10% may in fact, be cheating grossly on the government, paying less than 1/7 of what they should be paying. And many of them belong to civil society?

Will the expenditure patterns of Pinoy families significantly change as a result of the crisis we are facing? Will we learn to manage our priorities better? Some encouraging patterns have emerged; let us hope they will continue.

Indeed, the FIES is very rich in data. Data that should be converted into information, into knowledge and into wisdom! So that we can deal with the crisis looming in the horizon.  Perhaps, so that we can also deal better with those who cause the crisis!

Not that I will be spared the effects of the financial crisis but do you remember the hoopla caused by the Millennium Bug that bugged off and out with nary a damage? Maybe we overprepared for that; let us then hope the financial crisis will go away in similar fashion. Happy New Year to all!

 

Reactions and views are welcome thru email to the author at ra.virola@nscb.gov.ph.

_________________________

¹ Secretary General of the National Statistical Coordination Board (NSCB) and Chairman of the Statistical Research and Training Center (SRTC). He holds a Ph. D. in Statistics from the University of Michigan in Ann Arbor, U.S.A. and has taught mathematics and statistics at the University of the Philippines. He is also a past president of the Philippine Statistical Association. The author thanks Bernadette B. Balamban, Jessamyn O. Encarnacions, Mildred B. Addawe, Noel S. Nepomuceno, Candido J. Astrologo, Jr., and Simonette A. Nisperos for the assistance in the preparation of the article. The author also thanks Louie Desiderio of Business World for her interest in the CPI for the poor, which gave us the idea to write this piece. The views expressed in the article are those of the author and do not necessarily reflect those of the NSCB.

 

Posted 12 January 2009.

 

 

Table 1. Percent Distribution of Families in the Bottom 30% and Top 10%,
by Region: 1997-2003

REGION	Bottom 30%			Top 10%
	1997	2000	2003	1997	2000	2003
NCR	0.7	1.1	1.0	41.3	40.3	35.2
CAR	2.0	1.7	1.5	1.6	1.8	2.0
I	5.4	4.8	4.9	4.1	3.5	3.4
II	4.8	3.9	3.6	2.1	2.4	2.3
III	4.0	4.2	4.6	9.3	9.6	10.2
IV-A	4.3	4.4	6.0	14.6	16.9	19.4
IV-B	3.7	3.8	4.6	1.5	1.8	1.5
V	11.2	9.9	9.3	2.7	2.7	3.3
VI	11.1	11.0	10.1	4.8	5.3	4.8
VII	10.9	10.7	9.7	4.2	3.2	5.4
VIII	9.0	8.1	7.8	2.2	2.3	2.4
IX	5.3	6.3	7.0	1.8	1.7	1.5
X	6.9	6.8	7.0	3.3	2.5	2.9
XI	5.5	5.9	6.3	3.1	2.7	2.7
XII	5.5	6.9	6.4	1.8	2.0	1.8
Caraga	4.9	4.5	4.6	1.1	0.9	0.8
ARMM	4.8	5.9	5.6	0.5	0.3	0.5
PHILIPPINES	100.0	100.0	100.0	100.0	100.0	100.0

Note:
1. Distribution of families were based on annual per capita income
2. Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

Table 2. Share to Total Income of the Bottom 30% and Top 10% Families:
1997-2003

Income group	Share to Total Income
	1997	2000	2003
Bottom 30%	9.7	9.9	10.5
Top 10%	35.5	34.6	32.0

Source: Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

Table 3. Share to Total Expenditure by Commodity Group, by Income Group,
Philippines: 1997-2003

EXPENDITURE GROUP	SHARE TO TOTAL EXPENDITURE
	All income group			Bottom 30%			Top 10%
	1997	2000	2003	1997	2000	2003	1997	2000	2003
Food	44.2	43.6	43.1	63.5	63.0	61.0	27.7	27.8	28.0
Total Food Consumed at Home	39.5	38.6	37.7	61.8	60.6	58.4	22.6	22.5	22.2
Cereal and Cereal Preparations	12.8	11.9	11.1	29.1	27.6	25.0	4.7	4.3	4.3
Cereal	10.2	9.1	8.4	26.1	24.3	21.7	3.0	2.6	2.6
Rice	9.2	8.4	7.7	20.8	19.9	17.7	2.9	2.6	2.6
Corn	1.0	0.8	0.7	5.3	4.4	3.9	0.1	0.0	0.1
Cereal Preparation	2.6	2.7	2.7	2.9	3.3	3.3	1.7	1.7	1.7
Bread	1.3	1.3	1.3	1.5	1.5	1.5	0.8	0.7	0.9
Biscuit	0.3	0.3	0.2	0.3	0.3	0.2	0.2	0.2	0.1
Flour	0.0	0.1	0.0	0.0	0.1	0.1	0.0	0.1	0.0
Native Cakes	0.2	0.1	0.1	0.2	0.2	0.2	0.1	0.1	0.1
Noodles	0.2	0.2	0.2	0.3	0.3	0.3	0.1	0.1	0.1
Other Cereal Preparations	0.6	0.8	0.8	0.6	0.9	1.1	0.4	0.5	0.5
Roots and Tubers	0.7	0.6	0.6	1.6	1.4	1.2	0.4	0.3	0.3
Fruit and Vegetables	3.9	4.4	4.3	5.5	6.2	6.2	2.6	3.2	2.9
Meat and Meat Preparations	6.9	7.0	6.7	4.6	4.9	5.4	5.7	5.4	5.2
Dairy Products and Eggs	3.0	3.0	3.2	3.0	2.9	3.1	2.2	2.3	2.4
Fish and Marine Products	5.9	5.7	5.5	10.0	9.8	9.6	3.1	3.1	2.9
Coffee, Cocoa and Tea	1.1	1.0	1.0	1.8	1.6	1.7	0.6	0.5	0.5
Non-Alcoholic Beverages	1.4	1.4	1.5	1.1	1.1	1.1	1.1	1.2	1.3
Food Not Elsewhere Classified	3.7	3.6	3.8	5.1	5.1	5.1	2.4	2.2	2.5
Food Regularly Consumed Outside    the Home	4.7	5.0	5.4	1.7	2.3	2.6	5.2	5.3	5.7
Alcoholic Beverages	0.9	0.7	0.7	1.3	1.1	1.1	0.5	0.4	0.4
Tobacco	1.3	1.1	1.1	2.1	1.9	2.0	0.6	0.4	0.4
Fuel, Light and Water	5.3	6.3	6.5	5.4	6.4	6.3	4.7	5.3	5.9
Transportation and Communication	5.6	6.8	7.3	2.6	2.9	3.4	8.5	10.2	10.5
Household Operation	2.3	2.3	2.2	2.0	1.7	1.6	3.3	3.7	3.5
Personal Care and Effects	3.3	3.6	3.9	3.0	3.4	3.8	2.9	3.1	3.4
Clothing, Footwear and Other Wear	3.3	2.7	2.9	3.1	2.4	2.6	3.0	2.6	3.0
Education	3.7	4.2	4.0	1.8	2.1	1.9	4.8	5.6	6.0
Recreation	0.4	0.5	0.5	0.2	0.1	0.2	0.7	0.8	0.7
Medical Care	2.2	1.9	2.2	1.3	1.0	1.3	2.6	2.4	2.9
Non-Durable Furnishings	0.3	0.2	0.2	0.3	0.2	0.2	0.3	0.3	0.2
Durable Furniture and Equipment	3.0	2.5	2.6	0.9	0.6	0.9	4.3	4.0	4.0
Rent/Rental Value of Occupied Dwelling Units	14.2	14.3	13.1	6.3	7.4	7.6	21.4	20.3	17.3
House Maintenance and Minor Repairs	1.1	0.9	0.7	0.8	0.6	0.5	1.1	1.2	0.8
Taxes	2.5	2.2	2.1	0.2	0.2	0.2	5.7	4.5	4.5
Miscellaneous Expenditure	3.4	3.3	3.8	2.0	1.9	2.2	4.1	3.9	4.8
Special Family Occasions	2.4	2.4	2.6	1.6	1.5	1.7	2.5	2.5	2.7
Gifts and Contributions to Others	1.0	0.9	1.2	0.5	0.4	0.5	1.6	1.5	2.1
Other Expenditures	3.0	2.9	2.9	3.2	3.2	3.0	3.8	3.5	3.6
Total Family Expenditures	100.0	100.0	100.0	100.0	100.0	100.0	100.0	100.0	100.0

Source: Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

Table 4. Share to Total Basic Expenditure by Commodity Group, by Income Group,
Philippines: 1997-2003

EXPENDITURE GROUP	SHARE TO TOTAL BASIC EXPENDITURE
	All income group			Bottom 30%			Top 10%
	1997	2000	2003	1997	2000	2003	1997	2000	2003
Food	51.7	50.2	50.0	70.4	69.2	67.6	34.5	33.7	34.3
Fuel, Light and Water	6.2	7.2	7.6	6.0	7.0	7.0	5.8	6.5	7.2
Transportation and Communication	6.5	7.9	8.5	2.9	3.2	3.7	10.6	12.4	12.9
Household Operation	2.7	2.7	2.6	2.2	1.9	1.8	4.1	4.5	4.3
Personal Care and Effects	3.9	4.2	4.6	3.3	3.7	4.2	3.6	3.8	4.2
Clothing, Footwear and Other Wear	3.9	3.1	3.3	3.4	2.7	2.8	3.8	3.1	3.7
Education	4.3	4.9	4.7	2.0	2.3	2.1	6.0	6.7	7.3
Medical Care	2.6	2.2	2.6	1.5	1.1	1.5	3.2	2.9	3.5
Non-Durable Furnishings	0.4	0.3	0.3	0.3	0.2	0.3	0.4	0.3	0.3
Rent/Rental Value of Occupied Dwelling Units	16.6	16.4	15.2	7.0	8.1	8.5	26.7	24.7	21.2
House Maintenance and Minor Repairs	1.3	1.0	0.8	0.9	0.6	0.6	1.3	1.4	1.0
Total Basic Expenditures	100.00	100.00	100.00	100.00	100.00	100	100.00	100.00	100

Notes:
1/ Total Basic Expenditures are basic expenditure items included in the computation of the the official poverty thresholds in the country.
2/ Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

Table 5. Share to Total Expenditure by Selected Commodity, by Income Group,
Philippines: 1997-2003

EXPENDITURE GROUP	SHARE TO TOTAL EXPENDITURE
	All income group			Bottom 30%			Top 10%
	1997	2000	2003	1997	2000	2003	1997	2000	2003
Food	44.2	43.6	43.1	63.5	63.0	61.0	27.7	27.8	28.0
Total Food in Cash	40.1	40.2	39.9	49.6	50.6	50.3	26.8	27.2	27.3
Total Food in Kind	4.1	3.4	3.2	13.8	12.4	10.8	0.9	0.6	0.7
Rice	9.2	8.4	7.7	20.8	19.9	17.7	2.9	2.6	2.6
Rice, Special	1.9	1.5	1.3	2.0	1.8	1.1	1.5	1.2	1.2
Rice, Ordinary	7.0	6.3	5.9	17.3	16.0	14.6	1.4	1.4	1.3
Rice, NFA	0.3	0.4	0.4	1.3	1.9	1.9	0.0	0.0	0.0
Rice, Others	0.1	0.1	0.0	0.3	0.3	0.1	0.0	0.0	0.0
Pandesal		0.8			0.9			0.4
Noodles	0.2	0.2	0.2	0.3	0.3	0.3	0.1	0.1	0.1
Camote	0.2	0.1	0.1	0.6	0.5	0.4	0.0	0.0	0.0
Fruit and Vegetables	3.9	4.4	4.3	5.5	6.2	6.2	2.6	3.2	2.9
Fruits	1.5	1.7	1.6	1.8	1.9	1.8	1.3	1.6	1.4
Vegetables	2.4	2.8	2.7	3.8	4.3	4.4	1.4	1.5	1.5
Malunggay		0.1			0.3			0.0
Meat and Meat Preparations	6.9	7.0	6.7	4.6	4.9	5.4	5.7	5.4	5.2
Eggs	0.9	0.9	0.9	1.0	1.1	1.2	0.5	0.5	0.5
Personal care and Effects	3.3	3.6	3.9	3.0	3.4	3.8	2.9	3.1	3.4
Beautification Services	0.6	0.6	0.7	0.6	0.6	0.7	0.5	0.6	0.6
Beauty Parlor	0.3	0.3	0.3	0.2	0.2	0.2	0.3	0.4	0.4
Barbershop	0.3	0.3	0.3	0.4	0.4	0.4	0.2	0.2	0.2
Education	3.7	4.2	4.0	1.8	2.1	1.9	4.8	5.6	6.0
Tuition Fees	2.5	3.0	2.8	0.9	1.1	1.0	3.4	4.2	4.5
Tuition Fees in Cash	2.3	2.8	2.6	0.8	1.0	0.9	3.2	4.0	4.2
Tuition Fees in Kind	0.2	0.2	0.2	0.1	0.1	0.1	0.2	0.2	0.3
Books	0.2	0.2	0.2	0.0	0.1	0.0	0.3	0.3	0.3
Books in Cash	0.2	0.2	0.2	0.0	0.0	0.0	0.3	0.3	0.3
Books in Kind	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0	0.0
Medical	2.2	1.9	2.2	1.3	1.0	1.3	2.6	2.4	2.9
Drugs	1.1	0.9	1.0	0.8	0.6	0.7	1.1	1.0	1.3
Drugs in Cash	1.0	0.8	0.9	0.7	0.5	0.6	1.0	0.9	1.2
Drugs in Kind	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1	0.1
Total Tax	2.5	2.2	2.1	0.2	0.2	0.2	5.7	4.5	4.5
Income Tax	2.0	1.8	1.7	0.0	0.0	0.0	4.5	4.0	3.8
Total Family Expenditures	100.0	100.0	100.0	100.0	100.0	100.0	100.0	100.0	100.0

Source: Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

Table 6. Share tp Total Expenditure by Commodity Group, by Income Group,
Philippines: 1997-2003

EXPENDITURE GROUP	SHARE TO TOTAL EXPENDITURE
	All income group				Bottom 30%				Top 10%
	1997	2000	2003	2003 Rank	1997	2000	2003	2003 Rank	1997	2000	2003	2003 Rank
Food	44.2	43.6	43.1	1	63.5	63.0	61.0	1	27.7	27.8	28.0	1
Alcoholic Beverages	0.9	0.7	0.7	15	1.3	1.1	1.1	13	0.5	0.4	0.4	17
Tobacco	1.3	1.1	1.1	14	2.1	1.9	2.0	9	0.6	0.4	0.4	16
Fuel, Light and Water	5.3	6.3	6.5	4	5.4	6.4	6.3	3	4.7	5.3	5.9	5
Transportation and Communication	5.6	6.8	7.3	3	2.6	2.9	3.4	5	8.5	10.2	10.5	3
Household Operation	2.3	2.3	2.2	11	2.0	1.7	1.6	11	3.3	3.7	3.5	10
Personal Care and Effects	3.3	3.6	3.9	6	3.0	3.4	3.8	4	2.9	3.1	3.4	11
Clothing, Footwear and Other Wear	3.3	2.7	2.9	9	3.1	2.4	2.6	7	3.0	2.6	3.0	12
Education	3.7	4.2	4.0	5	1.8	2.1	1.9	10	4.8	5.6	6.0	4
Recreation	0.4	0.5	0.5	17	0.2	0.1	0.2	18	0.7	0.8	0.7	15
Medical Care	2.2	1.9	2.2	12	1.3	1.0	1.3	12	2.6	2.4	2.9	13
Non-Durable Furnishings	0.3	0.2	0.2	18	0.3	0.2	0.2	16	0.3	0.3	0.2	18
Durable Furniture and Equipment	3.0	2.5	2.6	10	0.9	0.6	0.9	14	4.3	4.0	4.0	8
Rent/Rental Value of Occupied Dwelling Units	14.2	14.3	13.1	2	6.3	7.4	7.6	2	21.4	20.3	17.3	2
House Maintenance and Minor Repairs	1.1	0.9	0.7	16	0.8	0.6	0.5	15	1.1	1.2	0.8	14
Taxes	2.5	2.2	2.1	13	0.2	0.2	0.2	17	5.7	4.5	4.5	7
Miscellaneous Expenditure	3.4	3.3	3.8	7	2.0	1.9	2.2	8	4.1	3.9	4.8	6
Other Expenditures	3.0	2.9	2.9	8	3.2	3.2	3.0	6	3.8	3.5	3.6	9
Total Family Expenditures	100.0	100.0	100.0		100.0	100.0	100.0		100.0	100.0	100.0

Source: Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

Table 7. Mean Income, Income Tax and Income Tax Ratio by Income Group:
1997, 2000 and 2003

	MEAN
	1997			2000			2003
	All Families	Bottom 30%	Top 10%	All Families	Bottom 30%	Top 10%	All Families	Bottom 30%	Top 10%
Family
Family Income	123,168	39,858	437,406	145,121	47,665	501,578	147,888	51,918	473,372
Income Tax	1,973	12	13,752	2,163	18	14,174	2,146	14	12,638
Income Tax Ratio to Family Income1	0.60	0.02	2.59	0.60	0.03	2.48	0.66	0.02	2.49
Per Capita
Per Capita Income	24,073	6,763	107,949	28,356	7,987	127,068	30,706	9,115	132,604
Per Capita Income Tax	386	2	3,394	423	3	3,591	446	3	3,540
Per Capita Income Tax Ratio to Per Capita Income2	0.59	0.03	2.81	0.59	0.03	2.65	0.64	0.02	2.69
Family Size	5.12	5.89	4.05	5.12	5.97	3.95	4.82	5.70	3.57

Note:
1/ Ratio of actual income tax to family income based on FIES were first computed for each household, then took the mean of these ratios.
2/ Ratio of per capita income tax to per capita income were first computed for each household, then took the mean of these ratios.
3/ In the generation of per capita income and per capita income tax, the family size for each household were used, which means that even those who are non-working members of the family were included.
4/ Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

Table 8. Mean Income, Taxable Income and Expected Income Tax
by Income Group: 1997, 2000 and 2003

	MEAN
	1997			2000			2003
	All Families	Bottom 30%	Top 10%	All Families	Bottom 30%	Top 10%	All Families	Bottom 30%	Top 10%
Mean Family Income	123,168	39,858	437,406	145,121	47,665	501,578	147,888	51,918	473,372
Taxable Income1	74,168	(17,142)	396,406	96,121	(9,335)	460,578	98,888	(5,082)	432,372
Expected Income Tax (A)	9,334		93,922	13,724		113,173	14,278		104,712
Ratio of Expected Income Tax to Family Income	7.58		21.47	9.46		22.56	9.65		22.12
Mean Actual Income Tax2 (B)	1,973	12	13,752	2,163	18	14,174	2,146	14	12,638
Ratio of B/A	0.21	-	0.15	0.16	-	0.13	0.15	-	0.12
Family Size	5.12	5.89	4.05	5.12	5.97	3.95	4.82	5.70	3.57

Notes:
1/ Assumptions in the computation of taxable income:

a. Sole earner
b. Income are sourced from wages and salaries
c. Assumed the following dependents in the different income groups:

All Income: 3 dependents
Bottom 30%: 4 dependents
Top 10%: 2 dependents

Note: Deducted P8,000 per child from the gross family income.

d. Deducted P25,000 as head of the family from the gross family income.

2/ Mean of actual income tax based on the Family Income and Expenditure Survey
3/ Based on special computations made by the NSCB Technical Staff on the Family Income and Expenditure Survey of the National Statistics Office

 

 

 

 

 

 

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