DAVAO CITY – Davao City Representatives Paolo Duterte and his son Omar Vincent Duterte have filed House Bill No. 5645 – Value-Added Tax Social Transfer for Indigent Citizens Act of 2025 – to ease the economic burden on the country’s poorest families.
According to the Dutertes, HB No. 5645 seeks to institutionalize a permanent social assistance program that provides periodic VAT rebates to indigent Filipinos through cash and non-cash support.
In a statement on Wednesday, Oct. 22, they explained that while VAT remains a vital source of government revenue, it disproportionately impacts low-income households.
Rep. Paolo said that the Value-Added Tax Social Transfer Program aims to reduce that burden by returning a portion of VAT paid by indigent citizens through direct financial assistance.
“The VAT affects everyone, but it hits the poor the hardest. Through the Value-Added Tax Social Transfer program, we want to ensure that indigent Filipinos cannot carry that burden alone,” Rep. Paolo said.
Under the proposal, the program will be a permanent mechanism for delivering financial and material aid to qualified individuals and households. It will be funded through a revolving VAT Social Fund (VSF), ensuring the initiative’s sustainability.
“Beneficiaries will be identified using the Department of Social Welfare and Development’s (DSWD) National Household Targeting System, or Listahanan,” the two lawmakers said.
Those classified as “poor” or “near-poor” will be eligible, while core indigent households – determined through asset testing and thresholds set by the National Economic and Development Authority – will receive the highest level of assistance.
The program will provide direct cash rebates to help families cope with the cost of basic goods, alongside non-cash benefits such as food, essential commodities, or services that reduce household expenses.
Rep. Omar, one of the youngest members of the 20th Congress, said the measure reflects a long-term vision for social equity. He added that all assistance will be distributed through a targeted, data-driven system to ensure it reaches the most vulnerable.
“This is about institutionalizing compassion. We’re not just responding to economic challenges, we’re putting in a permanent system of support for those who are most vulnerable,” Rep. Omar said.
They urged their colleagues to support the bill, citing its alignment with the country’s duty to promote social justice and protect the welfare of low-income people.
“This isn’t just about policy, it’s about dignity, fairness, and inclusive growth,” Rep. Paolo said, emphasizing that the Value-Added Tax Social Transfer program will be a crucial pillar in the country’s poverty reduction efforts.