HOUSE OF REPRESENTATIVES

RECEIVED
Republic of the Philippines 4 JUL 2018
HOUSE OF REPRESENT IVES

Quezon City, Metro Manila

Seventeenth Congress
First Regular Session

House Bill No. _99"?

Introduced by Hon. Luis Jose Angel N. Campos, Jr.

EXPLANATORY NOTE,

Section 1, Article XV of our Constitution states that: “The State recognizes the Filipino
family as the foundation of the nation. Accordingly, it shall strengthen its solidarity and actively
promote its total development. Corollarily, Section 4, Article XV states that: “The family has
the duty to care for its elderly members but the State may also do so through just programs of
social security.

In pursuit of the foregoing constitutional policies, this bill proposes to remove the
limitation on the number of qualified dependents that a taxpayer may claim for tax deduction. At
present, a maximum of only four (4) qualified dependent may be claimed by qualified taxpayers
as additional exemption at P 25,000 per capital.

Furthermore, this bill likewise secks to expand the coverage of qualified dependents to
include the following;

qd) Parents or both parents with the following conditions:

(a) the parent or parents should not be gainfully employed, they
should be living with the taxpayer, and dependent upon the taxpayer
for chief support; or

(b) such parent or parents are incapable of self-support because of
metal or physical disability.

(2) Taxpayers who act as legal guardian of a person with mental or physical
disability, regardless of age and incapable of self-support, provided that only the
legal guardian can avail of the additional exemption for a particular taxable year
to the exclusion of the biological parents.

The passage of this bill is earnestly sought since it will address the inequalities and biases
against large families; champion the cause of the mentally and physically challenged and those
who take care of them; and support taxpayers who have unselfishly taken the cudgels of caring
for dependent parents.

Premises considered, the passage of this measure that will certainly alleviate the plight of

many families is sincerely sought.
LUIS JOSE ANGEL N. CAMP¢



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

Seventeenth Congress
First Regular Session

House Bill No. _

Introduced by: HON. LUIS JOSE ANGEL N. CAMPOS, JR.

AN ACT PROVIDING ADDITIONAL EXEMPTIONS TO FAMILIES WHERE THE TAX
PAYER IS SUPPORTING AGING PARENTS AND/OR PERSONS WITH DISABILITIES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress

assembled:

SECTION 1. SHORT TITLE.
2014”

‘This Act shall be known as the “Family Care Act of

SEC. 2. DECLARATION OF POLICY AND OBJECTIVES. - The State recognizes the
Filipino family as the foundation of the nation. Accordingly, it shall strengthen its solidarity and

actively promote its total development.

Further, the Constitution declares that the family has the duty to take care of its elderly

members but the State may also do so through just programs of social security.

‘Towards this end, Congress shall give highest priority to the enactment of measures that

will grant reprieves, and reduce social and economic inequalities by alleviating the financial

conditions of every family especially those with more children; individuals caring for aging pare

parents, and those who act as legal guardians to persons with mental or physical disability.

SEC. 3. ADDITIONAL TAX BENEFITS. - In addition to the benefits granted under
existing laws, Section 35(B) of Republic Act No. 8424, otherwise known as the National Internal
Revenue Code of 1997, as amended by Republic Act No. 9504, is hereby further amended, to

read as follows:

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“SEC. 35. Allowance of Personal Exemption for Individual Taxpayer.

“(A) In General. — For purposes of determining the tax provided in
Section 24(A) of this Title, there shall be allowed a basic personal exemption
amounting to Fifty thousand pesos (P50,000) for each individual taxpayer.

“In the case of married individuals where only one of the spouses is
deriving gross income, only such spouse shall be allowed the personal exemption.

“(B) Additional Exemption for Dependents, — There shall be allowed an
additional exemption of Twenty-five thousand pesos (P25,000) for each
dependent [not exceeding four (4)].

“For purposes of this Subsection, THE TERM [a] “dependent/S” SHALL
mean{s a:

“(1) ONE OR MORE UNMARRIED legitimate, LEGITIMATED,
illegitimate or legally adopted child NOT MORE THAN TWENTY-ONE (21)
YEARS OF AGE, [chiefly dependent upon and] living with the taxpayer, [if such
dependent is not more than twenty-one (21) years of age, unmarried and] not
gainfully employed, [or if such dependent] AND DEPENDENT UPON THE
LATTER FOR CHIEF SUPPORT; OR WHERE SUCH CHILD, regardless of
age, is incapable of self-support because of mental or physical [defect]
DISABILITY.

“The additional exemption for dependents REFERRED HEREIN shall be
claimed by only one of the spouses in the case of married individuals,

“In the case of legally separated spouse, additional exemptions may be
claimed only by the spouse who has custody of the child or children [: Provided,
that the total amount of additional exemption that may be claimed by both shall
not exceed the maximum additional exemptions herein allowed].

“2) A PARENT OR BOTH PARENTS, NOT GAINFULLY EMPLOYED,
LIVING WITH THE TAXPAYER, AND DEPENDENT UPON THE LATTER
FOR CHIEF SUPPORT; OR WHERE SUCH PARENT ARE INCAPABLE OF
SELF-SUPPORT BECAUSE OF MENTAL OR PHYSICAL DISABILITY.

“AN INDIVIDUAL TAXPAYER WHO ACTS AS LEGAL GUARDIAN
TO A PERSON WITH MENTAL OR PHYSICAL DISABILITY, REGARDLESS
OF AGE AND INCAPABLE OF SELF-SUPPORT, MAY CLAIM THE
ADDITIONAL EXEMPTION FOR THE SAID DEPENDENT: PROVIDED,
THAT ONLY THE LEGAL GUARDIAN CAN AVAIL OF THE ADDITIONAL
EXEMPTION FOR A PARTICULAR TAXABLE YEAR TO THE EXCLUSION
OF THE BIOLOGICAL PARENTS.

XXX.

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SEC. 4. PENALTY. — Notwithstanding the penalty provided for in Section 267 of the
National Intemal Revenue Code of 1997, as amended, any person who wilfully, violates the
preceding section by declaring fictitious dependents shall, upon conviction, be liable for the
payment of a fine equivalent to thrice the amount of tax, interest and surcharges due from the
taxpayer.

Any government official or employee who knowingly and wilfully conspire or collude

with any taxpayer by issuing any false certification, or those who do or fail to do any act with

intent to enable any taxpayer to violate this Act
Fifty thousand pesos (P50,000) but not more than One Hundred Thousand Pesos (P100,000) and

| be punished with a fine of not less than

imprisonment of not less one (1) year but not more than five (5) years and perpetual
disqualification to hold public office. He shall also lose all the benefits due him as a result of

his service in the government, including the forfeiture of his separation and retirement benefits.

SEC. 5. IMPLEMENTING RULES AND REGULATIONS. - The Department of
Finance in coordination with the Bureau of Internal Revenue, and the Department of Social

Welfare Development shall issue the necessary implementing rules and regulations within thirty

(30) days upon the approval of this Act.

SEC. 6. SEPARABILITY CLAUSE. — If any provision of this Act is declared
unconstitutional or invalid, other part or provisions hereof not affected thereby shall continue to

be in full force and effect.
SEC. 7. SEPARABILITY CLAUSE. - If any provision of this Act is declared
unconstitutional or invalid, other parts or provisions hereof not affected thereby shall continue to
be in full force and effect.
SEC. 12. REPEALING CLAUSE, — All laws, decrees, rules and_ regulations
inconsistent with the provision of this Act are hereby repealed, amended or modified

accordingly.

SEC. 13. EFFECTIVITY. — This Act shall take effect fifteen (15) days following its

publication in at least two (2) newspapers of general circulation or the Official Gazette.

Approved,

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