The Supreme Court assured a “Merry Christmas” for our senior citizens when it affirmed the constitutionality and mandatory character of the 20-percent discount on their purchases from or use of “hotels and similar lodging establishments, restaurants and recreation centers, medicine… funeral and burial services… theaters, cinema houses and concert halls, circuses, carnivals and other similar places of culture, leisure and amusement… medical and dental services.” It also validated the implementing rules and regulations of the discounts.
Who bears discount? Ably penned by Justice Mariano C. del Castillo, the 15 justices, in Manila Memorial Park vs DSWD (Dec. 3, 2013), were unanimous in being magnanimous to the seniors, but were divided on who shall shoulder the cost of the discount: Should it be the government only or both the sellers and the government?
Under the original law (Republic Act No. 7492) passed on April 23, 1992, the burden was shouldered solely by the government because the entire 20-percent discount was deemed a “tax credit” which the sellers (restaurants, drugstores, funeral parlors, etc.) were allowed to deduct from their taxes.
However, at the initiative of the Bureau of Internal Revenue, a new law (RA 9257) was enacted on Feb. 26, 2004, that treated the 20-percent discount merely as a “tax deduction.” Which means that the sellers could only deduct the amount of the discount from their “gross income from the same taxable year that the discount is granted.”
Thus, the sellers were allowed to deduct the discounted sum from their taxable income, for which they no longer paid the 32-percent corporate income tax. Stripped of legalese, the sellers bore 68 percent of the discount, and the government, 32 percent.
Legal justifications. The decision justified the sharing of cost by invoking the “police power” of the state to “regulate or restrain the use of liberty or property for public welfare” provided the regulation or restriction is not “unreasonable, oppressive or confiscatory.” After all, the Court said, nothing prevents the sellers from recouping their subsidies to seniors by increasing their prices for the nonseniors.
To justify the preferential treatment, the Court reasoned that the discount “is intended to improve the welfare of senior citizens who, at their age, are less likely to be gainfully employed, more prone to illnesses and other disabilities, and thus, in need of subsidy in purchasing basic commodities.”
Del Castillo’s 38-page ponencia merited lively concurring opinions from Justices Presbitero J. Velasco Jr. and Lucas P. Bersamin, a novel concurring and dissenting opinion from Justice Mario Victor F. Leonen, and a vigorous dissent from Senior Justice Antonio T. Carpio.
While agreeing that the senior-citizen discount is constitutional, Justice Carpio argued that the government should shoulder its full cost and that the sellers should be spared from bearing any part thereof. It is not a voluntary sales discount. Thus, he said, the state is actually forcibly taking a part of the purchase price from the private sellers without payment of just compensation.
He opined that, under the power of eminent domain, private property cannot be taken without the payment of just compensation. He concluded that the latter law (RA 9257) that merely granted a tax deduction to the private sellers should be declared unconstitutional and that the old law (RA 7492) which compensated the sellers with a “tax credit” should be deemed revived.
This case is important not only because it upheld the 20-percent senior-citizen discount but also because it disclosed the justices’ philosophical and sociological mindset on the role of law in economics, finance and business. The case deserves another column to discuss the magistrates’ views vis-à-vis my own legal philosophy of liberty and prosperity under the rule of law.
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Spirit of Christmas. On legal and humanitarian grounds, I agree with the Sandiganbayan’s order allowing former President Gloria Macapagal-Arroyo’s family to visit and stay with her in her detention facility at the Veterans Memorial Medical Center on Christmas Day and New Year’s Day.
First, she has not been convicted of any crime. Hence, she still enjoys the constitutional presumption of innocence. She is indefinitely detained at the hospital because she is charged with a capital offense. She has been confined there due to her frail health and three life-threatening surgeries. Medically, she is not over the hump, as the metal brace surgically installed on her spine could slip at any time and may result in severe nerve injury, if not death.
Second, under the Constitution, “[a]ll persons, except those charged with offenses punishable with reclusion perpetua when the evidence of guilt is strong, shall be bailable…” Her petition for bail has not been ruled on. It is still pending in the court. Hence, the evidence against her has not been ruled to be “strong.”
Third, she is suffering from mental stress and depression. The comfort and sympathy of her immediate family during these days of spiritual renewal will improve her physical and mental wellbeing without any prejudice to the government or to the people. There is minimal risk of escape as the facility is well guarded and the visits are for short duration only.
In the spirit of peace and reconciliation commemorating the birth of the Lord of Peace, I believe President Arroyo deserves to enjoy the love and comfort of her family.
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