Implementing rules on VAT exemption for PWDs out next month

The implementing rules and regulations (IRR) of Republic Act 10754, which exempts persons with disabilities (PWDs) from value-added tax (VAT), will be released next month, it was disclosed during the Senate budget deliberations Thursday.

The query was raised by Senator Ralph Recto, one of the law’s authors, during the plenary discussions on the 2017 budget of the Department of Social Welfare and Development (DSWD).

Senator Loren Legarda, who sponsored the DSWD budget in her capacity as Senate finance committee chair, said: “On December 1, in the DSWD central office. And you’re invited to witness it.”

Recto had earlier reminded the DSWD on the issuance of the IRR, noting that the law has been signed eight months ago.

RA 10754 or the Magna Carta for Persons With Disability was signed by former President Benigno Aquino III on March 23.

The IRR defines how the law’s provisions will be implemented and availed of.

RA 10754 exempts PWDs from all sales taxes on certain goods and services, like transport fares, medicines, medical and dental services and laboratory fees, raising the discount to 32 percent.

It also grants a P25,000 annual income tax deduction to relatives within the fourth civil degree of consanguinity or affinity, who are caring for and living with a PWD.

In the Department of Finance’s (DOF) presentation of the administration’s proposed tax reform package before the Senate last month, Undersecretary Karl Kendrick Chua said they are considering “transforming” the VAT exemption for PWDs to “more direct services and health packages."

Chua said the move was intended to plug the leakages.

“The main reason why we [want to] do these is we’d like to plug the leakages of those who pretend to be seniors, or benefit from their grandparents and people with disability into a system wherein it’s fair and transparent,” Chua said. — Kathrina Charmaine Alvarez/RSJ, GMA News