SOLO parents may soon avail of the 10% discount and value-added tax (VAT) exemption on their purchases of essentials such as baby’s milk, diapers, and doctor-prescribed medicines for their kids six years of age and below, as provided under a new law on financial aid for single dads and moms, according to a lawmaker.

Camarines Sur Representative LRay Villafuerte, National Unity Party (NUP) president, who is one of the lead authors of this 2022 legislation—Republic At (RA) No. 11861 or “The Expanded Solo Parents Welfare Act”—said this developed as the Bureau of Internal Revenue (BIR) recently issued Revenue Regulations (RR) No. 1-2023 on the implementation of the tax privileges to be accorded establishments that are to grant the 10%-discount and VAT-exemption to qualified single parents on their purchases of goods for their babies, toddlers, and preschoolers that are listed under the law.

However, he pointed out that this hefty price discount under the law can be availed of only by solo parents earning P250,000 each or below per year—the same income bracket as those who are exempted from paying income taxes under RA 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) Law.

“We are looking forward to the full compliance by the concerned establishments with this financial relief under RA 11869 for low-income single parents who have single-handedly been raising their babies, toddlers and/or preschoolers,” Villafuerte, a lead proponent of this law, said.

“The BIR’s release of the guidelines on tax breaks for establishments that will comply with this provision of the social protection program for single dads and moms under RA 11869 will certainly provide relief to this sector’s members, many of whom have been hit badly by COVID-19 and are probably taking a while to get back on their feet after the pandemic,” he added.

Under RR 1-2023, the actual grant of the discounts and VAT exemptions to qualified single parents are subject to the guidelines to be issued by the Department of Health (DOH), in coordination with the Food and Drug Administration (FDA), Philippine Health Insurance Corp. (PhilHealth) and the Department of the Interior and Local Government (DILG).

Villafuerte explained that under RR 1-2023, qualified single parents or the guardians of qualified dependents are entitled to the 10% discount on, and VAT-free, purchases from drugstores, pharmacies, grocery stores, and similar establishments of breastmilk or infant formula, food supplements and micronutrient supplements as well as sanitary diapers for their kids with the age of six years or below.

Qualified solo parents are also entitled to the same privileges on their purchases of branded or generic medicines, vaccines, and medical supplements, provided that these are medically prescribed by attending physicians for preventing or treating diseases, illnesses, and injuries, and whose prescriptions are in the names of the qualified children.

For every purchase, the solo parent has to present to the establishment his or her Solo Parent Identification Card (SPIC) and Booklet issued by either the Solo Parents Office (SPO) of the provincial or city government or the Solo Parents Division (SPD) of the municipal government.

Under the BIR order, establishments that will honor the price discounts and VAT exemptions may claim such as tax deductions from their gross incomes and based on the cost of the goods sold.

Any violation under RR 1-2023 shall suffer the penalties set in the Tax Code and RA 11861.

RR 1-2023 was signed by Finance Secretary Benjamin Diokno, as recommended by BIR Commissioner Romeo Lumagui Jr.

RA 11861, which lapsed into law last June 4, amended RA 8972, or the “Solo Parents Welfare Act of 2000,” by expanding the benefits for single parents and doubling the monthly pension to P1,000 due to qualified solo fathers and mothers.