A possible surge of business permit renewals and applications at the start of 2017 has prompted the Department of the Interior and Local Government (DILG) to remind local government units (LGUs) to observe the exemption of medical and dental clinics from mayor’s permit and business permit.
In a memorandum circular, DILG Secretary Ismael Sueno advised all local chief executives (LCEs) that medical and dental practitioners are exempted from being subjected to any other national or local tax, license or fee, including the mayor’s permit or business permit, provided that concerned medical professionals pay the corresponding professional tax to the province or city where he/she practices his/her profession.
He said the exemption of medical and dental professionals is in compliance with Section 139 (b) of the Local Government Code that provides, “Every person legally authorized to practice his profession shall pay the professional tax to the province where he practices his profession or where he maintains his principal office in case he practices his profession in several places: Provided, however, That such person who has paid the corresponding professional tax shall be entitled to practice his profession in any part of the Philippines without being subjected to any other national or local tax, license or fee for the practice of such profession.”
In the same manner, an opinion from the Bureau of Local Government Finance states, “Medical clinics, as a direct consequence of the practice of such professions, cannot be imposed with a graduated tax on the premise that it is a business establishment offering to render professional service.”
Sueno, however, pointed out that only those clinics that are used for the conduct of medical or dental check-ups are exempted, while those that have established shops for the purpose of generating income and are engaged in the sale of products may be required by LGUs to secure the mayor’s permit or business permit.
Such products include medicines, in the case of medical clinics; glasses in the case of optometric clinics; and toothpaste, toothbrush or other products in the case of dental clinics.
The DILG secretary also directed all provincial governors, city and municipal mayors, DILG regional directors and the regional director of the Autonomous Region in Muslim Mindanao to cause the widest dissemination of the memorandum circular to all LGUs within their respective jurisdictions.
He stated that non-compliance with the memorandum-circular shall be dealt with in accordance with pertinent laws, rules and regulations.