Senate probe on tax leakage due to fake PWD IDs sought

Gatchalian said the fake PWD IDs also undermined the success of the local government units’ (LGUs) various assistance and incentives, as well as other programs meant to address the needs of PWDs. (Pexels photo)

By Leonel Abasola, Philippine News Agency

MANILA – Senator Sherwin Gatchalian has filed a resolution seeking an investigation into tax leakages caused by the proliferation of fake person with disability (PWD) identification cards being used to avail of a 20-percent discount and value-added tax (VAT) exemption.

Under his Senate Resolution No. (SRN) 1239, Gatchalian revealed reports of individuals selling fake PWD IDs in certain areas, including in Bacolod City where 100 fake PWD IDs were discovered.

He said the IDs were printed on a different kind of paper, the PWD numbers were mixed up, and the encoded types of disabilities were spurious.

In Cebu City, the city government confiscated at least seven fake PWD IDs after receiving reports of an alleged increase in the issuance of fake PWD IDs. The confiscated IDs did not match the names in the city government’s verified list of PWDs, according to SRN 1239.

“The use of fake PWD IDs has robbed the national government of revenues it could have collected if not for the VAT-exemption and PWD discounts given to unqualified individuals,” Gatchalian, chair of the Senate Committee on Ways and Means, said in a news release on Monday.

Gatchalian said the fake PWD IDs also undermined the success of the local government units’ (LGUs) various assistance and incentives, as well as other programs meant to address the needs of PWDs.

He said restaurant owners have also raised concerns over losses sustained due to the use of fake PWD IDs that enable holders to avail of the 20 percent PWD discount and VAT exemption.

“Restaurant owners have claimed that over the recent years, there has been a significant increase in sales made to PWDs from only 5 percent to 30 percent,” he added in SRN 1239.

Under Republic Act 10754, also known as the Act Expanding the Benefits and Privileges of Persons with Disability, establishments are allowed to recoup the PWD discounts granted through tax deductions based on the net cost of the goods sold or services rendered.

“We need to determine the effect on the government’s tax collection of the tax leakages caused by the proliferation of fake PWD IDs so we can craft the necessary legislation or policy recommendation,” Gatchalian said.