Senate OKs bill exempting PWDs from 12% VAT

The Senate approved on third and final reading Monday a bill seeking to exempt persons with disabilities (PWDs) from paying the mandatory 12-percent Value Added Tax (VAT) on goods and services.

Senate Bill No. 2890 seeks to exempt PWDs from paying the VAT on top of the 20-percent discount they are entitled to on particular goods and services.

Senator Juan Edgardo “Sonny” Angara, chairman of the Ways and Means Committee and sponsor of the bill, said the new tax breaks under SBN 2890 are part of growing government programs and policies meant to assist the sick and handicapped and uplift them in their moments of need, as mandated under existing laws such as Republic Act 7277.

Republic Act 7277, also known as the Magna Carta for Disabled Persons, provides a 20-percent discount for PWDs on the sale of goods and services such as medicines, medical and dental services, hospital and laboratory fees, local transport fares, restaurants, hotels, theaters and educational assistance.

The senator also said the proposed measure “aligns the PWD law with that of the Expanded Senior Citizens Act of 2010 or Republic Act 9994, which provides a VAT exemption to senior citizens on top of their 20 percent discount on particular goods and services.”

Senate Pro-Tempore Ralph Recto, principal author of the bill, said the bill also seeks to provide additional income tax exemption amounting to P25,000 to those caring for PWDs who are incapable of supporting themselves regardless of  their age.

“The tax deduction is the same as what is currently claimed by a parent of a child not over the age of 21, which is P25,000 annually. It is only right to remove the age criteria for a PWD-dependent because caring for him or her does not have a fixed expiry date. In many cases, it extends from cradle to grave,” he said.

Angara said that SBN 2890 will prove to be a great benefit and relief to the country’s PWDs, which had significantly increased over the years.

According to the Census on Population and Housing, there are 1.443 million PWDs or 1.57 percent of the total population in 2010.

Angara said the figure showed a substantial increase from a similar study in 2000 where the number of PWDs was only 935,551, or 1.23 percent of that year’s population.

The 2010 study also showed that the highest number of PWDs was found in Region IV-A or the Calabarzon Region with 193,000 PWDs, followed by the National Capital Region with 167,000 PWDs. The Cordillera Administrative Region (CAR) registered the lowest rate of PWDs at 26,000. — Amita Legaspi/BM, GMA News