File photo from Agence France-Presse
MANILA, Philippines — Popular coffee chain Starbucks on Wednesday apologized for a sign in one of its branches imposing a limit on the 20-percent discount for senior citizens.
During a House committee on ways and means hearing, Starbucks operations director Angela Cole said the company took full accountability for the error and that it had ordered the immediate removal of the signage, which limited the senior citizens’ discount to only one drink and one food.
She explained that the signage was “in response to our employees asking for a suggested approach” on how to apply the discounts.
Under Republic Act No. 9994 (Expanded Senior Citizens Act of 2010) and Republic Act No. 10754 (Act Expanding the Benefits and Privileges of PWDs), seniors and PWDs are given a 20-percent discount on top of their exemption from the 12-percent value-added tax (VAT) on certain goods and services.
Speaker’s order
On Monday, Speaker Martin Romualdezv— who had ordered a probe into the signage — stressed that discounts granted to these sectors “should not be limited in any way for as long as they are for their use and personal consumption.”
“It was an error, our signage was not properly worded so we acknowledge our mistake, and we are really disappointed at the confusion that we have caused,” Cole told lawmakers. “The guideline … was never followed, and we remain steadfast in ensuring that we extend the privileges as intended in all our stores throughout the Philippines.”
Later, Starbucks issued a statement apologizing for the incident and assured its customers that it would still issue government discounts on all food and beverage orders “clearly for the exclusive use and enjoyment of senior citizens, persons/people with disabilities, and other eligible individuals.”
Not enough
Albay Rep. Joey Salceda, chair of the House committee on ways and means, called on Starbucks to not only own up to its mistake but also consider doing a “one free drink and one free croissant” promo for senior citizens and PWDs for a day.
“Sorry is not enough,” Salceda said. “This is a violation and therefore this is a case. You know Filipinos are just forgiving, but what I want from you is an exemplary action from you that shows you are really repentant over what you did.”
He also threatened to write a letter to Rustan’s Coffee Corp., the local licensee for the global coffee brand, “seeking that it should be addressed substantially and not just in words.”
The Albay lawmaker also said his committee would look into remedial legislation or regulation to address gaps and confusion in the implementation of the laws and discounts governing senior citizens and PWD discounts.
Needed correction
Senior Citizens Rep. Rodolfo Ordanes said he was preparing a bill to make senior discounts apply to sales promotions.
In a statement on Wednesday, Ordanes cited a need to “correct the law by giving these sectors the full availment of their purchase discounts by removing that choice between the discount and the promo because the choice has no ‘economic logic.’”
He said Wednesday’s hearing shed light on the “many illegal and unkind ways businesses have resorted to to avoid giving the 20-percent discount.”
The bill he is drafting will seek to ban purchase quotas and “other similar rules that shrink the coverage of the discounts,” Ordanes added.
Abuse of privilege
While most complaints concerning the discount had been directed at establishments, an official of the Department of Trade and Industry (DTI) reminded the public that customers too may be held liable for abusing the privilege.
“If we look at the law, it also provides for penalties against those who are found to have abused the senior citizen discount—those who try to claim discounts even if the people who will consume the bought items are not senior citizens. The law imposes a penalty of imprisonment for such an offense,” Trade Assistant Secretary Amanda Marie Nograles of the DTI’s consumer protection group said.
Under RA 9994, any person who refuses to honor the senior citizen card may suffer a maximum penalty of imprisonment of up to six years and a fine of up to P200,000.
The violation may also result in the cancellation of the permits or franchises granted to the business entity.
Any person found to have abused such privilege may be imprisoned for as long as six months and fined up to P100,000.
But while the DTI is not the main enforcing agency on the matter, Nograles said the complaints received by the department would be referred to the Office of the Senior Citizens Affair (Osca).
“We in the DTI have a so-called ‘no wrong door’ policy because ultimately these complaining senior citizens are consumers. So we will receive their complaints, but refer them to the Osca as they are the agency mandated by law to handle such complaints,” she said.