Bill seeks to exempt senior citizens' bank deposits from 20% tax

MANILA, Philippines - A bill pending at the House of Representatives seeks to exempt the bank deposits of senior citizens from a 20-percent withholding tax, should it be passed into law. House Bill 3408 said the exemption of senior citizens' bank deposits from the 20 percent withholding tax on interest covers deposits not higher than P600,000. It also allows senior citizens to enjoy a 20 percent discount from establishments such as transport service providers, hotels, restaurants, and recreation centers, as well as for the purchase of medicines. Rep. Narciso Santiago III (ARC), the bill's author, said senior citizens shall be granted free medical and dental services in government clinics but subject to guidelines issued by the Department of Health, Government Service Insurance System and the Social Security System. "In addition to these privileges retired senior citizens shall be granted, whenever feasible and practicable, the continuance of the same benefits and privileges given by the GSIS, SSS, and Pag-Ibig to those in active service," Santiago said. Santiago said it is the duty of the family to care for its elderly members, however, the government may also extend assistance through just programs of social security. He cited the provision of Republic Act No. 7432 mandating NEDA to determine the exemption from the payment of individual taxes of senior citizens' with incomes up to a certain level. "However, the exemption does not include the final 20 percent withholding tax on interest income earned from bank deposits," he noted. Santiago noted majority of senior citizens derive a substantial part of their income from the interest on their savings and retirement benefits, which are deposited in banks. - GMANews.TV