Philippines sets rules for businesses sharing senior discount costs
Tax deductions will be capped at each participant’s agreed share, while documented agreements must be submitted to the Department of Health.
Businesses in the Philippines that agree to divide senior citizen discount costs must limit their deductions from gross income to their respective shares, under new Bureau of Internal Revenue (BIR) rules.
Revenue Regulations No. 007-2026 permits such arrangements among retailers, manufacturers, distributors, wholesalers-retailers and wholesalers. A business claiming a deduction cannot claim more than the cost allocated to it in the agreement.
The regulation requires participants to document their arrangement following Department of Health guidelines and mechanisms. They must also submit a copy to the department.
Philippine law gives senior citizens a 20% discount when buying medicines and other essential goods. Stores completing the sale have typically carried much of the resulting cost.
The BIR said experience with implementing the discount, particularly in pharmaceuticals, showed that clearer, formal arrangements were needed to divide the financial burden across businesses supplying the goods. The rules address cost sharing involving businesses such as drugstores, supermarkets and pharmaceutical companies.
