Beauty
Facials, Laser Treatments, Fillers, and More to Be Included in New Tax Reform Bill?
The tentative new tax isn't going easy on the beauty industry.
IMAGE COLLAGE BY SANDY ARANAS
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Beauty comes with a price, and its price in the Philippines just got steeper. The Senate has filed a bill to reform the Tax Reform for Acceleration and Inclusion (TRAIN) that includes excising an additional 20 percent of taxes on cosmetic surgery. Under section 30 of the amendment, "cosmetic surgeries, procedures, and body enhancements undertaken for aesthetic reasons” are filed under Non-Essential Goods and Services, which, among other goods, are subject to the tax adjustment.

Initially, this was thought to only include beauty procedures that require surgery, but our insider sources from ambulatory clinics say that this will also target the prices of basic, non-surgical beauty procedures, such as facials, fillers, laser and anti-aging treatments, and skin whitening procedures, among many others. This would mean a significant surge in prices for the services offered by well-known ambulatory aesthetic clinics such as the Belo Medical Group, The Aivee Clinic, Dr. CRB, and The Skin Inc., among other establishments in the metro.

Since the first mention of this reform, many have stressed that those most unjustly affected by this tentative tax would be the female market. Initially, it seemed that the reform is meant to target the upper classes by labeling these beauty treatments as “non-essential goods”–classified as luxuries and grouped together with luxury yachts, jewelry, and perfumes. The tax reform, however, could affect a diverse group of customers, regardless of socioeconomic status, age, and gender, according to a beauty executive. A huge market for these ambulatory clinics are overseas Filipino workers, as well as both men and women who work in fields where aesthetics is a requirement. Of course, there are also those who save up–some even take years–to treat their conditions such as severe acne, scarring, and more.

The table below illustrates ballpark figures of starting prices at upscale clinics and how the hypothetical 20 percent will reflect on those prices.

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It seems that the only ones exempted, for now, are those seeking reconstructive surgery for medical purposes, including breast reduction in the case of a cyst, or repair due to disease, burns, trauma, infections, or congenital disorders, such as a cleft lip or palate.

PhilStar reports that possible revisions and final deliberations will be made when sessions resume in November. President Duterte seeks to have the law signed by December 15.

The amendment, prepared by the Committee on Ways on Means and authored by 14 senators, seeks to enable the reform bill as an accelerated solution to enable the government to fund an infrastructure program worth P8 trillion.

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Hannah Lazatin
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