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SIXTEENTH CONGRESS ) f° RECEIVED
REPUBLIC OF THE PHILIPPINES )

FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez an
Representative Maximo B. Rodriguez, Jr.

House Bill No. 1438

EXPLANATORY NOTE

This bill seeks to exempt senior citizens from paying the final 20% withholding tax on
interest income from bank deposits to enable our elderly to fully utilize their savings and from
paying real property tax in order alleviate them from additional financial burdens in the latter
years of their life

Section 4, Article XV of the 1987 Philippine Constitution states that the family has the
duty to care for its elderly members but the State may also do so through juts programs of
social security

Pursuant to this policy, Republic Act No, 7432 also known as the “Senior Citizens
Act” and Republic Act No, 9257 also known as "Expanded Senior Citizens Act of 2003" were
enacted to grant benefits and special privileges to the elderly as recognition of their
significant role and contribution in society. Under these laws, senior citizens are exempted
from the payment of individual income taxes, provided that their annual taxable income does
not exceed the poverty level as determined by the National Economic Development
Authority (NEDA) for that year.

However, this exemption does not include exemption from payment of the final 20%
tax on interest income from bank deposits under the National Internal Revenue Code. This
failure derives most of senior citizens a substantial portion of their income from the interest
earnings on their life savings and retirement benefits deposited in banks. Further, while
under Section 5 paragraph f of Republic Act No. 9257, individuals or non-government
institutions establishing homes, residential communities or retirement villages solely for the
senior citizens shall be accorded realty tax holiday for the first five (5) years starting from the
first year of operation, there is likewise a need for the State to give assistance to senior
citizens who choose to stay at home and to the families that take care of their needs.

The State should be liberal in granting benefits to our elderly, who make up about 6.4
percent or §.2 million, of the population which is estimated to increase to 9.6 percent of the
general population by 2020. This as much we owe to them for devoting their productive
years in the service of our nation.

Through this additional benefit, itis the intent of this proposed measure to afford our
senior citizens the abllity to attend to other demands of their condition, such as medical and
social requirements, using the money originally intended for the payment of the real property
tax.

In view of the foregoing, immediate passage of this bill is earnestly sought.

RUFU$ B. RODRYGUEZ

MAXIMO. RODRIGUEZ, JR.

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SIXTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES —).
FIRST REGULAR SESSION

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and
Representative Maximo B. woe gues, Jr.

House Bill No.

AN ACT
GRANTING ADDITIONAL BENEFITS AND PRIVILEGES TO SENIOR CITIZENS
BY FURTHER AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 7432,
OTHERWISE KNOWN AS "AN ACT TO MAXIMIZE THE CONTRIBUTION OF
SENIOR CITIZENS TO NATION BUILDING, GRANT BENEFITS AND SPECIAL
PRIVILEGES AND FOR OTHER PURPOSES" AS AMENDED

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

SECTION 1, Section 4 of Republic Act No. 7432 as amended by Republic Act No.
9994, otherwise known as the “Expanded Senior Citizens Act of 2010", 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;

“(c) the grant of a minimum of five percent (5%) discount relative to the
monthly utilization of water and electricity supplied by the public
utlities: Provided, That the individual meters for the foregoing utilities are
registered in the name of the senior citizen residing therein: Provided,
further, That the monthly consumption does not exceed one hundred kilowatt
hours (100 kWh) of electricity and thirty cubic meters (30 m3) of
water: Provided, furthermore, That the privilege is granted per household
regardless of the number of senior citizens residing therein;

(a) exemption from training fees for socioeconomic programs;

“(e) free medical and dental services, diagnostic and laboratory fees such as,
but not limited to, x-rays, computerized tomography scans and blood tests, in
all government facilities, subject to the guidelines to be issued by the DOH in
coordination with the PhilHealth;

"(f) the DOH shall administer free vaccination against the influenza virus and
pneumococcal disease for indigent senior citizen patients;

"(g) educational assistance to senior citizens to pursue pot secondary, tertiary,
post tertiary, vocational and technical education, as well as short-term
courses for retooling in both public and private schools through provision of
scholarships, grants, financial aids, subsides and other incentives to qualified
senior citizens, including support for books, learning materials, and uniform
allowances, to the extent feasible: Provided, That senior citizens shall meet
minimum admission requirements;

“(h) to the extent practicable and feasible, the continuance of the same
benefits and privileges given by the Government Service Insurance System


(GSIS), the Social Security System (SSS) and the PAG-IBIG, as the case
may be, as are enjoyed by those in actual service;

(i) retirement benefits of retirees from both the government and the private
sector shall be regularly reviewed to ensure their continuing responsiveness
and sustainability, and to the extent practicable and feasible, shall be
upgraded to be at par with the current scale enjoyed by those in actual
service;

“(to the extent possible, the government may grant special discounts in
special programs for senior citizens on purchase of basic commodities,
subject to the guidelines to be issued for the purpose by the Department of
Trade and Industry (DTI) and the Department of Agriculture (DA);

“(k) provision of express lanes for senior citizens in all commercial and
government establishments; in the absence thereof, priority shall be given to
them; and

"() death benefit assistance of a minimum of Two thousand pesos (Php2,
000,00) 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.

“(M) EXEMPTION FROM THE PAYMENT OF REAL PROPERTY TAX AND
ANY TAX ON REAL PROPERTY, SUCH AS THE SPECIAL EDUCATION
FUND TAX: PROVIDED, THAT, THIS PROVISION SHALL APPLY ONLY
TO A REAL PROPERTY OWNER WHO HAS ATTAINED THE AGE OF
SIXTY YEARS OR OLDER, ON REAL PROPERTY THAT IS REGISTERED
UNDER HIS OR HER NAME AT THE TIME OF THE ATTAINMENT OF
SUCH AGE AND HAS OCCUPIED THE SAID PROPERTY, WHETHER
CONTINUOUS OR BROKEN, FOR A PERIOD OF NOT LESS THAN TEN
YEARS PRIOR TO THE ATTAINMENT OF THE AGE OF SENIORITY;
PROVIDED FURTHER THAT, THEIR ANNUAL TAXABLE INCOME DOES
NOT EXCEED THE POVERTY LEVEL AS DETERMINED BY THE
NATIONAL ECONOMIC AND DEVELOPMENT AUTHORITY (NEDA) FOR
THE TAXABLE YEAR.”

“(N) EXEMPTION FROM THE 20% WITHHOLDING TAX ON INTEREST
INCOME FROM THE BANK DEPOSITS, PROVIDED HOWEVER THAT:

4.) THE EXEMPTION FROM PAYING THE WITHHOLDING
TAX SHOULD NOT EXCEED SIX HUNDRED
THOUSAND PESOS (P600,000.00); AND

2.) THE SENIOR CITIZEN SHOULD PRESENT TO THE
MANAGER OF THE BANK IN WHICH HE/SHE
DEPOSITS HIS/HER MONEY HIS SENIOR CITIZEN'S
ID AND A CERTIFICATE FROM THE CHIEF OF THE
AGENCY/FIRM FROM WHICH HE RETIRED.”


“In the availment of the privileges mentioned above, the senior citizen, or his/her duly
authorized representative, may submit as proof of his/her entitled thereto any of the
following
"(4) an identification card issued by the Office of the Senior Citizen Affairs
(OSCA) of the place where the senior citizen resides: Provided, That the
identification card issued by the particular OSCA shall be honored nationwide;
(2) the passport of the senior citizen concerned; and
“(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.

“In the purchase of goods and services which are on promotional discount, the
senior citizen can avail of the promotional discount or the discount provided herein,
whichever is higher.

“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, 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,
further, That the total amount of the claimed tax deduction net of VAT, if applicable,
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
(NIRC), as amended.”

SECTION 2. Separability Clause ~ If any section or provision of this Act shall be
declared unconstitutional or invalid, the provisions hereof which are not affected
thereby shall continue to be in full force and effect

SECTION 3. Repealing Clause ~ Laws, rules and regulations and other issuances
inconsistent with the provision of this Act are deemed modified, revoked or repealed
accordingly.

SECTION 4. Effectivity — This law shall take effect immediately upon its approval.

Approved,