Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

EIGHTEENTH CONGRESS
Second Regular Session

House Bill No. ~* 8832

Introduced by
Senior Citizens Party-List Representative RODOLFO “OMPONG” M. ORDANES

EXPLANATORY NOTE

‘The dream of every Filipino has always been to comfortably retire once they become
Senior citizens. Time and again, all of us have imagined ourselves in the Filipino dream of
retiring on our own abode with a sizeable nest egg that will take care of us for the rest of our
golden years. However, the rising cost of goods coupled with the slow increase in income has
made this dream of our senior citizens remain just a dream.

Today, senior citizens are unable to fully enjoy retirement because they are unable to
save enough money to compete with the rising costs of being senior citizens. According to the
Philippine Statistics Authority's (PSA) Philippine National Health Accounts, senior citizens spent
PhP 171.55 billion pesos for their health alone in 2018, Studies show that a comfortable
retirement in the Philippines would require around PhP 40,000 to PhP 60,000 per month.
However, compared to the high costs of retirement, PSA data shows that a significant majority
or seventy-five percent (75%) of senior citizens are not covered by social security or
retirement plan. Of those receiving a monthly pension, sixty percent (60%) receive below PhP
5,000 per month while only four percent (4%) receive a monthly pension of PhP 30,000 and
above. Thus, a significant majority of senior citizens are constrained to heavily rely on their

savings upon retirement?

1 Mina, C. and Cacnio, F. (2019), “Are Filipino Senior Citizens Financially Protected?: Evidence
from Consumer Finance Survey," 14 National Convention on Statistics, Retrieved from:

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Unfortunately, Filipino retirees were found to have limited savings for their retirement.
‘According to the Bangko Sentral ng Pilipinas, Filipinos have only 3.6 months’ worth of income
for retirement, Meanwhile, the average savings of a Filipino family is only around PhP 52,000
per year.? Thus it is almost impossible for our senior citizens to comfortably retire today.

The current predicament of our senior citizens runs contrary to the 1987 Philippine
Constitution which mandates that the State has a duty to care for its elderly members through
programs of social security? and the State's policy under existing laws which emphasizes its
mandate to re-affirm the valued Filipino tradition of caring for the senior citizens and foster
their capacity to attain more meaningful and productive aging.*

This measure seeks to partially increase the savings of our senior citizens in
preparation for retirement by giving exempting them from income tax until they retire.
Through this, we, as a nation, can finally fulfill our Constitutional mandate to promote social
Justice by protecting and uphold the welfare of the vulnerable sectors of our society while
helping them achieve the Filipino dream of a comfortable retirement.

In view of this, the passage of the bill is sought.

RODOLFO “OM M. ORDANES

https://psa.gov.ph/sites/default/files/7.4.2%20Are%20Filipino%20Retirees%20and%20Would-
be%20Retirees% 20Sufficiently%20Protected%20Evidence%20from%20a%20Household-
based%20Survey.pdf

PSA, 2015 Family Income and Expenditure Survey.

3 Phil. Const. Art. XV Section 4,

Expanded Senior Citizens Act of 2010.



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

EIGHTEENTH CONGRESS
Second Regular Session

House Bill No, 8832

Introduced by
Senior Citizens Party-List Representative RODOLFO “OMPONG” M. ORDANES

AN ACT
GRANTING AN INCOME TAX EXEMPTION TO SENIOR CITIZENS AGED SIXTY (60)
AND ABOVE

e it enacted by the Senate and House of Representatives of Philippines in Congress
assembled:

Section 1. 7it/e. - This Act Shall be known as the "Income Tax Exemption for Senior
Citizens Act.”

Section 2. Insertion of a new paragraph in Section 24 of the NIRC, as amended by the R.A.
10963 or commonly known as the “Tax Reform for Acceleration and Inclusion (TRAIN),” is
hereby further amended to read as follows:

"Sec. 24. Income Tax Rates.
(A) Rates of Income Tax on Individual Citizen and Individual Resident Alien of the
Philippines.
bed
(2) Rates of Tax on Taxable Income of Individuals. - The tax shall be computed in
accordance with and at the rates established in the following schedule:
(a) Tax Schedule Effective January 1, 2018, until December 31, 2022:

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Section 3. Repealing Clause. - All law, executive orders, rules, and regulations or any part
thereof inconsistent herewith are deemed repealed or modified accordingly.

Section 4. Separability Clause. - If any part or provision of this Act shall be declared
unconstitutional and invalid, such declaration shall not invalidate other parts thereof which
shall remain in full force and effect.

Section 5. Affectivity. - This Act shall take effect fifteen (15) days its complete publication n
the Official Gazette or in at least two (2) newspapers of general circulation, whichever comes

earlier.

Approved,