REVENUE REGULATIONS NO. 1-2009 issued on February 17, 2009 prescribes the rules and regulations to implement Republic Act (RA) No. 9442, entitled “An Act Amending Republic Act 7277, Otherwise Known as the Magna Carta for Persons with Disability,” relative to the tax privileges of persons with disability and tax incentives for establishments granting sales discount. Persons with disability shall be entitled to claim at least 20% discount from the following establishments relative to the sale of goods or services for their exclusive use or enjoyment, viz: a. Hotels and similar lodging establishments and restaurants; b. Sports and recreation centers; c. Theaters, cinema houses, concert halls, circuses, carnivals and other similar places of culture, leisure and amusement; d. All drugstores regarding purchase of medicine; e. Medical and dental privileges in government and private facilities, such as but not limited to diagnostic and laboratory fees (e.g., x-rays, computerized tomography scans and blood tests), including professional fees of attending doctors (in private facilities), subject to guidelines to be issued by the Department of Health, in coordination with the Philippine Health Insurance Corporation (Philhealth); f. Domestic air and sea transportation based on the actual fare except promotional fare. If the promotional fare discount is higher than the 20% discount privilege, the person with disability may choose the promotional fare and should no longer be entitled to the 20% discount privilege; and g. Land transportation privileges in bus fares such as ordinary, aircon fares and on public railways (such as LRT, MRT, PNR), and such other similar infrastructure that will be constructed, established and operated by public or private entity. Toll fees of skyways and expressways are likewise subject to at least 20% discount, however, this privilege can be availed only by a person with disability owning the vehicle. Establishments granting sales discounts to persons with disability on their sale of goods and/or services shall be entitled to deduct the said sales discount from their gross income subject to the following conditions: a. The sales discounts shall be deducted from gross income after deducting the cost of goods sold or the cost of service; b. The cost of the sales discount shall be allowed as deduction from gross income for the same taxable year that the discount is granted; c. Only that portion of the gross sales exclusively used, consumed or enjoyed by the person with disability shall be eligible for the deductible sales discount; d. The gross selling price and the sales discount must be separately indicated in the sales invoice or official receipt issued by the establishment for the sale of goods or services to the person with disability; e. Only the actual amount of the sales d iscount granted or a sales discount not exceeding 20% of the gross selling price or gross receipt can be deducted from the gross income, net of Value-Added Tax (VAT), if applicable, for Income Tax purposes, and from gross sales or gross receipts of the business enterprise concerned, for VAT or other Percentage Tax purposes; and shall be subject to proper documentation under pertinent provisions of the Tax Code of 1997, as amended; f. The business establishment giving sales discount to qualified person with disability is required to keep separate and accurate records of sales, which shall include the name of the person with disability, ID Number, gross sales/receipts, sales discount granted, date of transactions and invoice number for every sale transaction to person with disability; and g. All establishments which granted sales discount to persons with disability on their sale of goods and/or services may claim the said discount as deduction from gross income. The foregoing privileges granted to person with disability shall not be claimed if the said person with disability claims a higher discount as may be granted by the commercial establishment and/or under other existing laws or in combination with other discount program/s. Thus, a person with disability who is at the same time a senior citizen can only claim one 20% discount on a particular sales transaction. In view of the amendment brought about by RA No. 9504 under Section 35(A) and (B) of the Tax Code of 1997, a benefactor of a person with disability whose civil status is “single” shall be entitled to the new personal exemption of P 50,000 just like any other individual taxpayer, whether single or married, with or without qualified dependent, subject to the Transitory Provisions of Revenue Regulations No. 10-2008. On the other hand, the benefactor of a person with disability may only be entitled to claim the new additional exemption of P 25,000 per qualified dependent child (not exceeding four) if the person with disability is his/her legitimate, illegitimate or legally-adopted child, whether minor or of legal age. In other words, for purposes of additional exemption, the “benefactor” will not be entitled to the additional exemption unless that benefactor is a “parent” of the person with disability. The privileges under the Act and in these Regulations available to persons with disability who are Filipino citizens may only be granted upon presentation of any of the following proof of his/her entitlement thereto: a. An identification card issued by the city or municipal mayor or the barangay captain of the place where the person with disability resides; or b. The passport of the person with disability concerned; or c. Transportation discount fare Identification Card (ID) issued by the National Council for the Welfare of Disabled Persons (NCWDP). However, upon the effectivity of the Implementing Rules and Regulations jointly promulgated by the different government agencies, NCWDP will already adopt the ID issued by the Local Government Units (LGUs) for purposes of uniformity in the implementation. NCWDP will provide the design and specification of the ID that will be issued by the LGUs. For the first violation of any provision of the Act and these Regulations, a fine of not less than P 50,000.00 but not exceeding P 100,000.00 or imprisonment of not less than six months but not more than two years, or both at the discretion of the court; and for any subsequent violation thereto, a fine of not less than P 100,000.00 but not exceeding P 200,000.00 or imprisonment for not less than two years but not more than six years, or both at the discretion of the court. Any person who abuses the privileges granted herein shall be punished with imprisonment of not less than six months or a fine of not less than P 5,000.00, but not more than P 50,000.00, or both, at the discretion of the court. If the violator is a corporation, organization or any similar entity, the officials thereof directly involved shall be liable therefor. If the violator is an alien or a foreigner, he shall be deported immediately after service of sentence without further deportation proceedings. Upon filing of an appropriate complaint, and after due notice and hearing, the proper authorities may also cause the cancellation or revocation of the business permit, permit to operate, franchise and other similar privileges granted to any business entity that fails to abide by the provisions of the Act and these Regulations.