Solo Parents, Expect to Receive VAT Exemption + Cash Subsidy Soon
The BIR has released a new regulation issuance.
(SPOT.ph) The much-anticipated Expanded Solo Parents Welfare Act will begin implementation this February, particularly where the Bureau of Internal Revenue is concerned. Yup, we're talking taxes.
There’s a lot to unpack with this new law, but the most important thing to note is that the Bureau of Internal Revenue (BIR) has begun calling for establishments to honor discounts and tax privileges granted to qualified solo parents, as stated in a revenue regulation dated January 18.
A 10% discount on basic necessities will granted to single parents with children six years old and below and are earning less than P250,000 annually. The expansion also provides P1,000 monthly cash subsidy for each solo parent earning minimum wage and below.
According to the BIR regulation, the basic necessities of a solo parent’s children include baby’s milk, food supplements, sanitary diapers, medicines, vaccines, and other medical supplements.
Solo parents will also be exempted from value-added tax (VAT) on selected goods. This means that VAT-registered stores must provide solo parents a net selling price, apart from the 10% discount.
To avail of the benefits, the solo parent must own a Solo Parent Identification Card (SPIC) to show as evidence of his or her status as one. In some cases, they might also be asked to present it alongside the solo parent booklet, which is issued together with the SPIC.
The revenue regulation was stamped by the BIR on January 18. According to the BIR issuance, the regulation should take effect after 15 days from publication. Since the issuance was published in the Manila Times on January 23, the exemptions should begin in early February.
A wider reach for solo parents everywhere
The Expanded Solo Parents Welfare Act widens the definition of "solo parents" to include spouses or any family member of OFWs who are in the low or semi-skilled category and are away from the Philippines for 12 consecutive months. Grandparents and family members or qualified guardians who bear sole responsibility over a child are also covered in this definition.
In addition, solo parents are granted automatic health coverage, educational scholarships (provided that the child meets the qualifications set by DepEd, CHED, and TESDA), and prioritization in low-cost housing projects with a more relaxed terms of payments.
As of 2020, the Department of Health and the University of the Philippines-National Institutes of Health placed the number of solo parents in the Philippines at an estimated 14 to 15 million, 95% of whom are women.
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