VAT exemption on PWDs won't result to govt revenue loss

MANILA, Philippines - The National Council on Disability Affairs said that the proposed exemption on persons with disability from the value added tax will not result to revenue loss of the government.

In a letter to Marikina Rep. Miro Quimbo, chairman of the House Committee on Ways and Means, NCDA acting executive director Carmen Reyes-Zubiaga, at the same time, expressed support to House Bill 1039, which seeks to exempt PWDs from the VAT on certain goods and services.

This is in addition to the 20 percent discount on the sale of goods and services being enjoyed by PWDs under Republic Act 7277 or the "Magna Carta for Persons with Disability."

Reyes-Zubiaga said that on the issue of revenue loss, the segment of population who will be able to avail of these VAT exempt privileges is negligible compared to the population at large.

She said the 2010 Census on Housing and Population pegs the disability population at 1,443,000, which is 1.57 percent of the 92,098,000 population of the country.

"The documented summary of issued ID cards by NCDA shows an issuance of 348,766 which is only 0.38 percent of the country's total population," she said.

With the figures, Reyes-Zubiaga said that not all of these PWD ID cardholders have the purchasing power to consume goods and services that entitle VAT exemption.

"Unless a concrete study on the amount of expenditure of PWDs and the amount of revenue which the government will lose be presented, the NCDA firmly supports that this bill be passed into law," she said.

On the susceptibility to abuse issue, she said proper guidelines are set forth in the NCDA Administrative Order No. 001 Rule IV of which requires medical certificate from a licensed private or government physician as part of the documents to be submitted for the issuance of ID cards.

She cited the Land Transportation Franchising and Regulatory Board, Light Rail Transit Authority, Philippine National Railways Office, Civil Aeronautics Board and Metrostar Express had issued appropriate guidelines for discount in transportation.

Reyes-Zubiaga said the Department of Trade and Industry and the Department of Agriculture joint issuance is also available granting five percent discount for a menu of commodities, the allowable purchase with discount is P1,300 per week, non-cumulative.

"This translates only to a discount of P65 per week which is not tax deductible and is shouldered by the supermarket owners," she said.

On discount for medicine, Reyes-Zubiaga said the Department of Health issuance governs wherein the allowable purchase is only for one-month consumption and the establishment would demand prescription in the name of the PWD before the discount may be granted.

"Furthermore, both discounts granted by virtue of the DTI-DA and DOH issuances require also a purchase booklet for recording, ensuring that the discount will be given only to the appropriate purchase limit per week," she said.