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Thread: Expanded Senior Citizens Act of 2010 (RA 9994)

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    Administrator Atty. James S. Biron's Avatar
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    Expanded Senior Citizens Act of 2010 (RA 9994)

    Dear readers, please post all your questions here regarding the Expanded Senior Citizens Act of 2010 (RA 9994).

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    Good day Atty. Biron,
    Is the senior citizen20% discount applicable to packaged food like chicharon, tamarind,
    pastillas, tarts, nuts and other “over the counter” pre-packed food items, sold by small kiosks and carts.

    I understand only restaurants, fast food outlets, hotels and the like, (where cooking is done) are covered.
    Is this a correct conclusion? Thank you.
    -E. Ocampo

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    Administrator Atty. James S. Biron's Avatar
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    Good day Mr. Ocampo,

    The Expanded Senior Citizens Act of 2010 or RA 9994 provides that:

    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)
    The Implementing Rules and Regulations (IRR) of the RA 9994 defines basic commodities as those which:

    refer to rice, corn, bread, fresh, dried and canned fish and other marine products, fresh pork, beef and poultry, meat, fresh eggs, fresh and processed milk, fresh vegetables, root crops, coffee, sugar, cooking oil, salt, laundry soap, detergents, and drugs classified as essential by the DOH and other commodities as maybe classified by the Department of Trade and Industry (DTI) and the Department of Agriculture (DA) according to Republic Act No. 7581 or the Price Act.
    Considering that these packaged foods you listed are not considered as basic commodities, therefore these shall not be subject to the 20% discount. But you should remember that the DTI and the DA may, in the future, classify these foods as basic commodities, you should thus get updates constantly from these departments.

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    Good day, Atty. Biron.

    Does the DOH have already issued a rule with regard to the 20% discount and vat exemption on medical and dental services, diagnostic and laboratory test? If the DOH has not issued yet, can a medical facility refuse to grant discount and exemption under the said law?

    I am trying to research this new expanded senior citizen law if the word “medical service” also includes hemodialysis. Maybe you can help me. Thanks. More Power, Attorney.
    Last edited by olantorres; 27th July 2010 at 12:16 PM.

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    Administrator Atty. James S. Biron's Avatar
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    Dear Mr. Torres,

    I have not personally seen a guideline from the DOH, but the latter is expected to release this guideline within 60 days from the effectivity of the RA 9994.

    However, even assuming that the DOH has not yet issued such guideline, a medical facility CANNOT refuse to grant discounts and exemptions under the said law for the simple reason that the language of the law is such that no guideline will be required to make it effective.

    The RA 9994 used the word "shall" when it said that "The senior citizens shall be entitled to the following..." In one case the Supreme Court said that the use of the word "shall" means that the provisions must be followed even in the absence of the guideline. Thus, the medical facility should provide the mandated 20% discount.

    The term medical services is broad enough to cover hemodialysis. The latter being the method of removing waste products from the blood is obviously a medical service. However, if you want to be 100% certain about this, you could wait for the DOH guideline and see if indeed hemodialysis is included in the term medical services.

    Cheers,
    James

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    Thank you attorney for such a very detailed answer to my queries. More power po!

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    Administrator Atty. James S. Biron's Avatar
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    You're welcome Olan!

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    Expanded Senior Citizens Act of 2010 (RA 9994)

    Good Day Atty. Biron!

    I work for a restaurant which offer foods good for sharing (each menu item is good for 2-3 persons)

    (e) Food, drinks and other consumable items provided in Section 3 (a) and (b), and Section 4, paragraph 2 of Article 7 purchased by the senior citizen shall be processed separately as an independent transaction from his/her non-eligible companions to ensure that it is for his/her exclusive consumption and to enable computation of the 205 discount and the exemption from the Value Added Tax (VAT), which only the senior citizen is entitled to.


    Do we really have to separate the transaction of the Senior Citizen? How do we identify which item are consumed by the senior citizen if all of our food items are "good for sharing"?

    Example: A family with a senior citizen only ordered for a family size pizza.

    How do we treat this case? Also, how about the Vat exemption? are we suppose to take off the vat of the whole pizza?

    Hope you could help me..

    Thank You and More Power!

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    Administrator Atty. James S. Biron's Avatar
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    Good day too Pad_thai!

    Yes, you have to process the purchase made by the senior citizen separately as an independent transaction.

    You don't have to identify the items which will be consumed by the senior citizen in this case, rather, what you have to do is to deduct the 12% VAT and 20% discount from the proportionate share of the senior citizen to the total cost of the ordered food items. I will show you how to do this using your example...

    Example:

    Assuming 3 individuals (a senior grandfather, father and son) ordered one pizza worth Php600. What you have to do is to divide this price by the total number of individuals who will eat the pizza in your restaurant, in this case Php600 / 3 for a total of Php200. Multiply this result (Php200) by the number of individuals who are not senior citizens, so Php200 x 2 for a total of Php400. This amount shall be paid in whole and NOT subject to any discounts or deductions.

    Now we will compute the discount for the senior citizen, what you need to do is deduct 12% VAT from the Php200 for a result of Php176. Then, deduct the 20% discount from this Php176 for a total of Php140.80.

    Thus, the total amount which these 3 individuals have to pay will be a total of (Php400+Php140.80) Php540.80.

    I hope this helps!

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    Big help, Atty. Biron!

    Thank you for taking the time to reply!

    I never expected that you'll reply this quick.

    More Power!

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