Philippine Restaurant Owners Resist Expanded Senior, PWD Discounts

Industry Opposes New Discount Mandates

Philippine restaurant owners, including major fast-food chains, recently convened to discuss congressional proposals. These bills would expand statutory discounts for senior citizens and persons with disabilities (PWDs). The Restaurant Owners of the Philippines (RestoPH), led by Mama Lou’s Hospitality Group co-founder David Sison, stated their opposition. They argue the legislation will negatively affect the industry by increasing costs.

Cost Transfer Threatens Promotions

Sison explained that one House bill could make existing consumer promotions unviable. These promotions, offered at thin profit margins, allow more Filipino families to dine out. Adding further mandated costs would eliminate these offers. When the senior citizen benefit began in 1992, the government funded it via a fully recoverable tax credit.

This changed in 2004 to a tax deduction, transferring the cost to private businesses. Currently, for every P20 (Philippine pesos) in mandated discount, restaurants recover only about P5, with businesses absorbing the rest.

Inconsistent Policy and Call for Funding

RestoPH maintains that while seniors and PWDs deserve their benefits, the policy requires honest accounting. Sison highlighted inconsistencies; for example, supermarket senior discounts are 5 percent, limited to basic necessities and capped weekly. Restaurant discounts, however, apply at 20 percent to all menu items, including luxury goods.

Proposed bills aim to increase this discount to 30 percent, or allow it to stack with existing promotions. RestoPH urges legislators to restore original government funding for any expanded benefits, rather than imposing further cost transfers onto businesses and other consumers.

Economic Impact on Businesses and Consumers

The proposed legislation would directly increase operating expenses for Philippine restaurants. This could force businesses to discontinue consumer promotions, effectively raising prices for other customers. Such changes might reduce transaction volumes, creating a ripple effect on farmers, suppliers, logistics providers, and employment.

RestoPH previously warned about existing industry struggles, including high LPG costs, rising rent, and utilities, which have already impacted hiring and operating hours.