CHAPTER I INTRODUCTION Background of the Study Senior citizens make up a significant percentage of the Philippine popul ation.

Of the 94,013,200 projected total population of Filipinos for 2010, 6,3 67,100 are senior citizens. This means that senior citizens make up 6.77% of t he total population. Of the 4, 362, 400 residents in Davao City alone, 276,000 are senior citizens. In addition to this fact, our 1987 Philippine Constitution expressly provides a provision on health in Article XIII, to wit: Section 11. The State shall adopt an integrated and comprehensive approach to he alth development which shall endeavor to make essential goods, health and other social services available to all the people at affordable cost. There shall be p riority for the needs of the under-privileged, sick, elderly, disabled, women, a nd children. The State shall endeavor to provide free medical care to paupers. Thus, acknowledging the significance of the population of senior citizen s in the country, and upholding the constitutional provision on health, the legi slature first enacted Republic Act No. 7432, otherwise known as the Expanded Senior Citizens Act of 2003 which has been now amended by Republic Act No. 9994, otherwis e known as the Expanded Senior Citizens Act of 2010. The Expanded Senior Citizens Act of 2010 (RA 9994) classifies a person a s a senior citizen based on age. Upon reaching the age of 60 years old, a perso n is classified as a senior citizen and is entitled to the benefits provided for in RA 9994 such as twenty percent (20%) discount and exemption from the value-a dded tax on the sale of goods and services such as but not limited to the purcha se of medicines, medical and dental fees, and actual fares for transportation. Among all the benefits granted to the senior citizens, the discount on m edicine and medical fees is the most beneficial for them because by reason of ol d age, health naturally deteriorates and this is the reason why senior citizens tend to pay more attention to their health than healthy younger individuals. As a result, the objective of RA 9994 regarding health care is truly achieved. However, as a consequence of the implementation of RA 9994, specifically in granting senior citizens discounts on medicine purchases, problems are very likely to arise problems that directly affect drugstores and could indirectly affe ct not only the senior citizens but also the entire buying population if there i s poor implementation of the law because such scenario could lead to widespread deterioration of the drugstore business. Statement of the Problem This study aims to determine the effect of the Expanded Senior Citizens Act of 2010 (Republic Act No. 9994) on the sales of Mercury Drug with respect to purchases of senior citizen customers. Specifically, this study aims to answer the following questions: 1. What is the effect of the implementation of the Republic Act No. 9994 on the total sales of Mercury Drug? 2. What are the effects of the removal of income cap on senior citizens on the drugstore business? 3. Is there any constitutional right on the part of Mercury Drug impeded by Republic Act No. 9994? 4. Is Republic Act No. 9994 effectively implemented? Does the government r eimburse the discounted medicines? Briefly, the inquiry s objectives are: 1. To identify the effect of the implementation of the Expanded Senior Citi zens Act on the total sale of drugstores. 2. To determine the effect of the removal of income cap on senior citizens on the drugstore business.

3. To point out constitutional rights deprived of drugstores as a result of the implementation of this law. Scope and Delimitation of the Study The researchers choose Mercury Drugstore Corporation (Mercury Dr ug) branches in Davao City as their respondent drugstore corporation. The resea rchers opt to conduct the study with the help of Mercury Drug based on the follo wing reasons: a.) It is the largest drug corporation in the country; b.) It has the most number of branches in Davao City; c.) It pioneered the questioning of t he taxing of already discounted medicines of the Expanded Senior Citizens Act; a nd d.) It is among the forerunners of Drugstores Association of the Philippines (DP A). The researchers will conduct interviews with Mercury Drug employees resp onsible for making product inventories and determining the total sales of each b ranch. The interviews to be conducted by the researchers will be limited to all the branches of Mercury Drug Corporation in Davao City only. Definition of Terms The following key terms which are recurrent in this study are define d in the sense in which they are used. In addition to the operational definition s, conceptual definitions are also provided. Benefit. Benefit comes in various definitions. It is any profit or acqui red right or privilege, primarily through a contract or in worker's compensation the term "benefit" is the insurance payment resulting from a fatal accident on the job, while "compensation" is for injury without death. In income taxation, o n the other hand, it is anything that brings economic gain. Drugstore. Drugstore is a business establishment where medical prescript ions are filled and drugs and medical supplies are sold. Privilege. It is a peculiar benefit, advantage, or favor; a right or imm unity not enjoyed by others or by all; special enjoyment of a good, or exemption from an evil or burden; a prerogative; advantage; franchise. Reimbursement. Reimbursement is the act of paying someone for expenses t hey have paid. It occurs in many contexts and is governed by federal, state, and local laws, as well as contract law. Reimbursement may be partial or full payme nt of expenses incurred and payments may be taxable depending on applicable law s Sale. An agreement by which one of the contracting parties, called the s eller, gives a thing and passes the title to it, in exchange for a certain price in current money, to the other party, who is called the buyer or purchaser, who , on his part, agrees to pay such price. Senior Citizen. Senior citizen is an elderly person, especially one who has retired. The Philippine laws classify a person belonging to this group based on age. People with ages sixty and above are classified under this group. Tax. Tax is a sum of money demanded by a government for its support or f or specific facilities or services, levied upon incomes, property, sales, etc. Significance of the Study The main objectives of the Expanded Senior Citizens Act of 2010 (RA 9994 ) is to recognize the rights of senior citizens and consequently, provide for th em the special benefits and privileges that they deserve on account of their sta tus in life. The discount granted to senior citizens in the health care area, being t he foremost and most useful among all the benefits enumerated in RA 9994, needs to be properly implemented in order to retain the noble intention of prioritizin g the needs of the elderly without prejudicing the economic welfare of drugstore companies. This study may help the legislators come up with solutions to the proble ms in the implementation of the Expanded Senior Citizens Act of 2010. This study may help the legislators come up with the best solution for t

he said problem and in return both the senior citizens and businessmen engaged i n selling medical supplies will be fully benefited, thus effectuating the noble intent of the Expanded Senior Citizens Act.