Is the senior citizen discount applicable to golf club memberships? Supreme Court says no

MANILA, Philippines — Golf clubs are not required to give “senior citizen discounts” in their membership fees, the Supreme Court said.

According to a decision penned by Associate Justice Jose Midas Marquez, the discount is not applicable to golf club memberships because it's neither a "good nor a service." He said this is covered by Section 4 of the Republic Act No. (RA) 9994 or the Expanded Senior Citizens Act of 2010.

“The plain language of the law thus requires the sale of a good or service for the 20% discount to apply. Absent the sale of a good or service, the 20% senior citizen discount does not apply,” Marquez said in the decision. 

Citing a 2019 ruling, the court said that when it collects membership fees, it is not selling its services. 

“Conversely, the members are not buying services from the club when dues are paid...As such, there could be no ‘sale, barter or exchange of goods or properties, or sale of a service’ to speak of, which would then be subject to the VAT,” the court said.

According to SC, the decision was made following the petition filed by Carlos Santos, Jr. before the Regional Trial Court (RTC) against the Department of Social Welfare and Development, late DSWD Secretary Corazon "Dinky" Soliman and Manila Southwoods

Santos, a member of Manila Southwoods Golf and Country Club, asked the RTC to invalidate Rule IV, Article 7, Section 4 (2) of the Implementing Rules and Regulations (IRR) of RA 9994. DSWD helped draft the IRR of the law in question.

The said provisions mention the 20% discount for senior citizens and their exemption to the value added tax.

According to the challenged IRR provision, non-profit, stock golf and country clubs, which have exclusive membership and are not accessible to the general public, are excluded from offering the 20% senior citizen discount.

However, the 20% discount still applies to the utilization of locker rentals and the golf clubs' facilities. The court said that these are services that are offered by the golf club.

“In contrast, the payment of fees for locker rentals and other charges pertaining to the use of golf facilities and equipment involves the sale by the golf and country club of services to the availing member,” the high tribunal said.

“In paying these fees, the purchasing member is availing of the club’s services, and not for the privilege of membership in the club,” it added.

Marquez's ruling on golf club membership discount was promulgated on July 25, 2023 and was uploaded by the SC on Tuesday, Oct. 17. It was concurred by Chief Justice  Alexander Gesmundo and Associate Justices Ramon Paul Hernando and Rodil Zalameda.