Tax Digest
Volume 9,
Series 53
Republic Act No. 10754: An Act Expanding the Benefits and Privileges of Persons with Disability (PWD)

On March 23, 2016, PNOY signed the amendment to the Magna Carta for Persons with Disability (PWDs) expanding the benefits granted to PWDs. The following are the existing benefits:

  1. Twenty percent (20%) discount and exemption from Value-Added Tax (VAT) on the following sale of goods and services:
    1. All services in hotels and similar lodging establishments; restaurants and recreation centers;
    2. On theaters, cinema houses, concert halls, circuses, carnivals and other similar places of culture, leisure and amusement;
    3. Purchase of medicines in all drugstores;
    4. On medical and dental services;
      1. In all government facilities; and
      2. Private hospitals and medical facilities
    5. Fares for domestic air and sea travel;
    6. On actual fare for land transportation;
    7. On funeral and burial services.
  2. Educational assistance;
  3. To the extent practicable and feasible, the continuance of the same benefits and privileges given by the Government Service Insurance System (GSIS), Social Security System (SSS), and Pag-IBIG, as the case maybe, as are enjoyed by those in actual service;
  4. Government may grant special discounts in special programs for PWD on purchase of basic commodities, subject to the guidelines to be issued for the purpose by the Department of Trade and Industry (DTI) and Department of Agriculture (DA); and
  5. Provision of express lanes for PWD in all commercial and government establishment.

In addition to the above, the new law allows taxpayers to recognize PWD’s within 4th degree of consanguinity as a qualified dependent for the purpose of determining its taxable net income. For each qualified dependents, taxpayers can claim an additional P25,000 personal exemption. Unlike to qualified children dependents, PWD’s can be claimed as dependent regardless of its age.

The mentioned privileges are applicable only for Filipino citizens upon submission of any of the following as proof of his/her entitlement thereto:

  1. An identification card issued by the city or municipal mayor or the barangay captain of the place where the PWD resides;
  2. The passport of the PWD concerned; and
  3. Transportation discount fare Identification Card (ID) issued by the National Council for the Welfare of Disabled Persons (NCWDP).

However, when the PWD chose to claim a higher discount granted by the establishment, the privileges under the RA 10754 cannot be availed of.

The establishment granting the discounts under RA 10754 may claim it as tax deduction based on the net cost of the goods sold or services rendered.

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