Manila Memorial Park, Inc. v. Sec.

of the DSWD

(G.R. No. 175356, December 3, 2013)

FACTS: R.A. No. 7432 was passed into a law, and later on some of its provisions were amended
by R.A. No. 9257. In one of its provisions it states that senior citizens have a privilege of 20%
discount from certain establishments such as hotels and similar lodging establishments,
restaurants and recreation centers, and purchase of medicines, etc.

To implement the tax provisions of R.A. 9257, the Secretary of Finance and DSWD issued
their own Rules and Regulations. Thus, the petition was filed by the petitioners against the
respondents. The petitioners assail the constitutionality of Section 4 of R.A. No. 7432, as
amended by R.A. No. 9257, and the implementing rules and regulations issued by the DSWD
and DOF insofar as these allow business establishments to claim the 20% discount given to
senior citizens as tax deduction.

ISSUE/S: Whether or not the 20% senior citizen discount is an exercise of police power.

RULING: Yes. The 20% 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. It may not be amiss to mention
also that the discount serves to honor senior citizens who presumably spent the productive
years of their lives in contributing to the development and progress of the nation. This distinct
cultural Filipino practice of honoring the elderly is an integral part of this law. As to its nature
and effects, the 20% discount is a regulation affecting the ability of private establishments to
price their products and services relative to a special class of individuals, senior citizens, for
which the Constitution affords a preferential concern.

The 20% senior citizen discount has not been shown to be unreasonable, oppressive, or
confiscatory. The court found that there are at least two conceivable bases to sustain the
subject regulation’s validity absent clear and convincing proof that it is unreasonable,
oppressive, or confiscatory. Congress may have legitimately concluded that business
establishments have the capacity to absorb a decrease in profits or income/gross sales due to
the 20% discount without substantially affecting the reasonable rate of return in their
investments considering (1) not all customers of a business establishments are senior citizens
and (2) the level of its profit margins on goods and services offered to the general public.