Recto wants tax breaks for those who care for elderly, disabled

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Recto says the status quo does not help Filipino taxpayers who naturally wish to care for their elders

PARENTS AS DEPENDENTS? Sen Ralph Recto wants tax breaks for those who care for their elderly parents. File photo by Senate PRIB/Joseph Vidal

MANILA, Philippines – Taxpayers who support their elderly or disabled parents may one day be able to claim tax deductions, according to Senate President Pro Tempore Ralph Recto.

 

Recto filed Senate Bill no. 257 or “The Family Care Act of 2013” that seeks to remove the limitation on the number of qualified dependents that a taxpayer may claim as tax exemptions. The bill also allows the inclusion of parents or wards as dependents, under certain circumstances.

 

Cultural trait

 

“I find difficulty in accepting that a taxpayer caring for an ailing parent finds no relief in our tax laws. Sa ilalim ng ating batas, maari tayong kumuha ng tax exemptions para sa ating malulusog na anak, ngunit hindi para sa ating mga magulang na may sakit,” the senator said in a statement released by his office on August 4, 2013. (Under our laws, we can get tax exemptions for our healthy children, but we cannot get them for our ailing parents.)

 

Recto says the status quo does not help Filipino taxpayers who naturally wish to care for their elders.

 

“Filipino families care for their elders and for those with disabilities, especially so if they are incapable of caring for themselves. The law should recognize this and grant these families tax reprieves,” Recto added.

Though the proposed bill expands the coverage of qualified dependents to include parents, they must not be gainfully employed and should be living with the taxpayer.

 

The bill also allows parents or wards to be listed as qualified dependents if they are incapable of self-support due to a mental or physical disability.

 

This bill alleviates the financial burden of individual taxpayers who support their parents by allowing them to claim their parents as additional dependents. This would consequently promote the Filipino value of taking care of the elderly,” Recto said.

 

No limit

 

The bill also seeks to remove the limitation on how many dependents a taxpayer can declare in order to apply for tax exemptions.

 

Recto said that at present, a maximum of only four qualified dependents may be claimed by qualified taxpayers as additional exemption at P25,000 per dependent.

 

“This cap on the number of dependents was established in 1973 under Presidential Decree No. 69.  At that time, in addition to generating more revenues, the government was bent on promoting family planning that, in effect, encourages the number of children for each family to only four,” he said.

 

However, as supported by some economists, setting a limitation on the number of dependents has no clear bearing on the decision of couples to beget children.

 

“As a matter of fact, those in the higher income levels have fewer children than those in the lower income groups. According to the Commission on Population, most of those who have four or more children are in the lowest and second lowest wealth quartile. These groups are not even income taxpayers,” Recto stated. – Rappler.com

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