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Section 4 Section 4 of Republic Act No. 7432, as amended by Republic Act No.

9257, otherwise
known as the "Expanded Senior Citizens Act of 2003", is hereby further amended to read as follows:

"SEC. 4. Privileges for the Senior Citizens. -

The senior citizens shall be entitled to the following:

"(a) the grant of twenty percent (20%) discount and exemption from the value -added tax (VAT), if
applicable, on the sale of the following goods and services from all establishments, for the exclusive
use and enjoyment or availment of the senior citizen

"(1) on the purchase of medicines, including the purchase of influenza and pnuemococcal
vaccines, and such other essential medical supplies, accessories and equipment to be
determined by the Department of Health (DOH).

"The DOH shall establish guidelines and mechanism of compulsory rebates in the sharing of
burden of discounts among retailers, manufacturers and distributors, taking into
consideration their respective margins;

"(2) on the professional fees of attending physician/s in all private hospitals, medical
facilities, outpatient clinics and home health care services;

"(3) on the professional fees of licensed professional health providing home health care
services as endorsed by private hospitals or employed through home health care
employment agencies;

"(4) on medical and dental services, diagnostic and laboratory fees in all private hospitals,
medical facilities, outpatient clinics, and home health care services, in accordance with the
rules and regulations to be issued by the DOH, in coordination with the Philippine Health
Insurance Corporation (PhilHealth);

"(5) in actual fare for land transportation travel in public utility buses (PUBs), public utility
jeepneys (PUJs), taxis, Asian utility vehicles (AUVs), shuttle services and public railways,
including Light Rail Transit (LRT), Mass Rail Transit (MRT), and Philippine National Railways
(PNR);

"(6) in actual transportation fare for domestic air transport services and sea shipping vessels
and the like, based on the actual fare and advanced booking;

"(7) on the utilization of services in hotels and similar lodging establishments, restaurants
and recreation centers;

"(8) on admission fees charged by theaters, cinema houses and concert halls, circuses,
leisure and amusement; and

"(9) on funeral and burial services for the death of senior citizens;

"(b) exemption from the payment of individual income taxes of senior citizens who are considered to
be minimum wage earners in accordance with Republic Act No. 9504;

may submit as proof of his/her entitled thereto any of the following: "(1) an identification card issued by the Office of the Senior Citizen Affairs (OSCA) of the place where the senior citizen resides: Provided. but not limited to. the government may grant special discounts in special programs for senior citizens on purchase of basic commodities. That senior citizens shall meet minimum admission requirements. furthermore. as are enjoyed by those in actual service. financial aids. That the identification card issued by the particular OSCA shall be honored nationwide. and . shall be upgraded to be at par with the current scale enjoyed by those in actual service. "(h) to the extent practicable and feasible. as well as short-term courses for retooling in both public and private schools through provision of scholarships. computerized tomography scans and blood tests. "(i) retirement benefits of retirees from both the government and the private sector shall be regularly reviewed to ensure their continuing responsiveness and sustainability. 000. "(g) educational assistance to senior citizens to pursue pot secondary. the senior citizen."(c) the grant of a minimum of five percent (5%) discount relative to the monthly utilization of water and electricity supplied by the public utilities: Provided. in the absence thereof. diagnostic and laboratory fees such as. "(f) the DOH shall administer free vaccination against the influenza virus and pneumococcal disease for indigent senior citizen patients. grants. "(e) free medical and dental services. That the monthly consumption does not exceed one hundred kilowatt hours (100 kWh) of electricity and thirty cubic meters (30 m3) of water: Provided. "(2) the passport of the senior citizen concerned. "(k) provision of express lanes for senior citizens in all commercial and government establishments. including support for books. That the individual meters for the foregoing utilities are registered in the name of the senior citizen residing therein: Provided. That the privilege is granted per household regardless of the number of senior citizens residing therein. and "(l) death benefit assistance of a minimum of Two thousand pesos (Php2. or his/her duly authorized representative. further. tertiary.00) shall be given to the nearest surviving relative of a deceased senior citizen which amount shall be subject to adjustments due to inflation in accordance with the guidelines to be issued by the DSWD. subject to the guidelines to be issued by the DOH in coordination with the PhilHealth. the Social Security System (SSS) and the PAG-IBIG. subsides and other incentives to qualified senior citizens. x- rays. "(j) to the extent possible. and to the extent practicable and feasible. and uniform allowances. in all government facilities. vocational and technical education. learning materials. post tertiary. 1avv phi 1 "In the availment of the privileges mentioned above. as the case may be. priority shall be given to them. to the extent feasible: Provided. subject to the guidelines to be issued for the purpose by the Department of Trade and Industry (DTI) and the Department of Agriculture (DA). the continuance of the same benefits and privileges given by the Government Service Insurance System (GSIS). "(d) exemption from training fees for socioeconomic programs.

000 per month The following items. meanwhile. the senior citizen can avail of the promotional discount or the discount provided herein. service. Groups. or groups that will continue to be VAT- exempt  Food and agricultural products  Senior citizens  Persons with Disability (PWD)  Cooperatives  Tourism  Education  Renewable energy  Health  Enterprises and BPOs located in Special Economic Zones  Condominium association dues  Rentals and leases below P15. and government agencies .com/products-exempted-from-vat-tax-reform/ Products. "(3) other documents that establish that the senior citizen is a citizen of the Republic and is at least sixty (60) years of age as further provided in the implementing rules and regulations.pinoymoneytalk. shall be included in their gross sales receipts for tax purposes and shall be subject to proper documentation and to the provisions of the National Internal Revenue Code (NICR)." https://www. will now also enjoy the benefit of not paying VAT. whichever is higher. further. state universities and colleges (SUC). That the cost of the discount shall be allowed as deduction from gross income for the same taxable year that the discount is granted: Provided. That the total amount of the claimed tax deduction net of VAT. "The establishment may claim the discounts granted under subsections (a) and (c) of this section as tax deduction based on the cost of the goods sold or services rendered: Provided. products. or transactions that will be VAT-exempt  Businesses with annual gross sales of P3 million and below  Government owned and controlled corporations (GOCCs). as amended. "In the purchase of goods and services which are on promotional discount. if applicable.

most of them either sought relief with the Courts or let the input VAT float in the company’s books. These situations are disadvantageous. This is a welcome development. or houses priced at P450. and hypertension (VAT exemption beginning 2019)  Socialized housing. and low-cost housing. including input value-added tax (VAT). Medicines for diabetes. where the input VAT relates to the taxpayers’ VAT zero-rated sales/receipts. Is there something in the TRAIN law that would encourage taxpayers to be more hopeful about their VAT refunds? Under the TRAIN law. however. considering the costs of filing and litigating a case in the Court of Tax Appeals (CTA) and of money while the input VAT remains unused. there are salient provisions that pertain to input VAT refunds. or those priced at P3 million and below (VAT exemption retained from 2018 to 2020 only) One of the concerns of corporate taxpayers is how to optimize their assets. cholesterol. taxpayers observed that most unutilized input VAT refund applications administratively filed with the Bureau of Internal Revenue (BIR) were unsuccessful. Consequently. .000 and below. When the input VAT remains unutilized for a long period. as VAT refund applications will now be processed at a faster pace. 120 DAYS REDUCED TO 90 DAYS Comparing the old provisions of the Tax Code and the TRAIN law. for day-to-day operations. 1. Before the passage of the Tax Reform for Acceleration and Inclusion (TRAIN) law. the period within which the BIR should decide on a VAT refund application was reduced from 120 days to 90 days. it becomes a trapped asset.

Hopefully. In other words. the taxpayers will get equitable resolutions from the BIR as fully and categorically explained by the Bureau in the decisions it will make. 3. This action of reducing requirements will definitely make the VAT refund evaluation faster for the BIR. Should the BIR find that granting a refund is not proper. An evaluation could be made whether there are superfluous documentary requirements that may be removed. in addition to the penalties of perpetual disqualification to hold public office. the BIR could consider revisiting the long list of documentary requirements for applying for a VAT refund. and to participate in any public election. 2. An appeal to the CTA may only ripen after the taxpayer’s receipt of the BIR’s decision denying the claim for VAT refund. There will be no more “implied” decision of denying the taxpayer’s application. PERSONAL ACCOUNTABILITY OF BIR OFFICERS An interesting provision in the TRAIN law empowers the taxpayer to file a criminal complaint against a BIR officer who deliberately fails to act on the application for refund within the prescribed period. This means that when no decision is issued by the BIR within 120 days. the BIR Commissioner must state in writing the legal and factual basis for such denial. to vote. This is not the case under the TRAIN law. in order for the taxpayer to go to court. The imposition of criminal liability is a heavy sanction for an erring BIR officer. The receipt of the decision has become a necessary requirement before judicial relief may be availed. . NO MORE ‘DEEMED DENIAL’ RULE The old rule included a “deemed denial” provision. there is no more need to wait for the BIR’s decision if the 120-day has lapsed. the application is deemed denied. and the taxpayer may seek relief with CTA within 30 days after the BIR’s 120-day period to review the application.In line with the reduced period.

It is not only the duty of the business to grow its enterprise.Many are hopeful that this personal accountability of BIR officers will make the review process of VAT refund applications more efficient. The government also has a responsibility of making sure that businesses thrive in the domestic and global market. though. Some fear. The amended provisions discussed above are promising developments as intended by legislators. the BIR must be fair and reasonable in deciding every claim for refund. Let’s start by unlocking trapped assets and making them as useful as they were meant to be. we are definite that its ultimate effect will trickle down from the growth of businesses to the increase in government revenues. We hope that the rules of VAT refund provide for a more expedient and simple process equitable in every way. By moving a company’s assets from a mere paper asset to an asset which can be reinvested. We wish that the VAT refund application procedures are streamlined and the list of requirements is significantly reduced. Taxpayers expect nothing less than good regulations and proper implementation. More important. In the days to come. This will likewise help businesses achieve global competitiveness. because of the inclusion of criminal liability provisions. that there might be a risk that. . It has been the sentiment of taxpayers that there is a lot to be improved in the VAT refund process. the BIR could just render haphazard reviews and decisions on VAT refund application just to get away with the imposition of the said penalty. Others say that the addition of the above provision may be seen as a wake-up call. The above changes under the TRAIN law could be a big leap. the implementing rules and regulations of the TRAIN law shall be released.

complexity. The Duterte administration commits to use the budget to provide targeted transfers and programs that are more transparent and accountable. The administration will direct the way to protect the poor and vulnerable compared to the tax exemptions and blind subsidies that are inefficient and largely beneficial to the rich since they have higher purchasing power. while medicines for diabetes. and tax evasion. This will be implemented together with an enhanced VAT refund system that will provide timely cash refunds to exporters. . The truth is. However. TRAIN aims to clean up the VAT system to make it fairer and simpler and lower the cost of compliance for both the taxpayers and tax administrators. and health. these exemptions are not free and someone pays for them. TRAIN repeals 54 out of 61 special laws with non-essential VAT exemptions. Purchases of senior citizens and persons with disabilities. This does not mean that the benefits the poor rightly deserve will be removed. This is achieved by limiting VAT exemptions to necessities such as raw agriculture food. the Philippines collect the same amount of VAT revenues as a percentage of the economy as that of Thailand despite only imposing a 7% VAT rate. and hypertension will be exempt beginning 2019. education. and discretion in our tax system resulting in leakages and opening doors for negotiation. Housing that cost below P2 million will be exempt from VAT beginning 2021. corruption. These tax exemptions have been given to many sectors and were supposedly very well meaning. and it is most often the poor who pays as they are deprived of quality public service necessary to accelerate their graduation out of poverty. The reform also aims to limit the VAT zero-rating to direct exporters who actually export goods out of the country. Expanding the Value- Added Tax (VAT) The Philippines has one of the highest VAT rates but also the highest number of exemptions in the Southeast Asia region. will continue to be exempt from VAT. Consequently. these exemptions have also created much confusion. while the Philippines is at 12%. thereby making the system fairer. however. high cholesterol.

php/e-vat/ .ph/taxreform/index.9 million to P3 million to protect the poor and low-income Filipinos and small and micro businesses and for manageable administration. Under TRAIN. This effectively exempts the sale of goods and services of marginal establishments from VAT.The VAT threshold is increased from P1.dof.gov. or ● Flat tax of 8% on gross sales or gross revenues in lieu of percentage tax and personal income tax. http://www. VAT exempt taxpayers will have the following options: ● PIT schedule with 40% OSD on gross receipts or gross sales plus 3% percentage tax ● PIT schedule with itemized deductions plus 3% percentage tax.