THE country’s largest associations of private schools is seeing the light at the end of the tax rate tunnel after lawmakers approved on third and final reading Senate Bill (SB) 2407.
Anthony Jose M. Tamayo, chairman of the Coordinating Council of Private Educational Associations of the Philippines (Cocopea), expressed gratitude for the approval of SB 2407, entitled “An Act Clarifying the Income Taxation of Proprietary Educational Institutions, Amending for the Purpose Section 27 (B) of the National Internal Revenue Code of 1997, As Amended.”
Tamayo was quoted in the statement as saying that Cocopea is looking forward to the convening of the bicameral conference committee to reconcile the versions of the two Houses of Congress.
“We are confident, that owing to the solidarity of intent and objective of both Houses in strengthening the complementary role of private education in our country, the bicam members would be able to swiftly come to an agreement to an enrolled bill to be signed by the President as soon as possible,” Tamayo added.
The House of Representatives earlier approved House Bill (HB) 9913, with 203 votes, no objections or abstentions, to secure with finality the grant of preferential tax rate of 10 percent for proprietary schools, including the temporarily lowered rate of 1 percent during the pandemic, under the Corporate Recovery and Tax Incentives for Enterprises (Create) Act. The House bill was introduced by Rep. Joey S. Salceda and co-authored by Deputy Speaker Rufus Rodriguez, Representatives Kiko Benitez, Mark O. Go, Luis Villafuerte, Joy Tambunting and 68 other members of the House.
Tamayo, who is also the president of the Philippine Association of Colleges and Universities (Pacu), said that with just a few days left before the congressional session breaks in October for the filing of candidacies for the 2022 national elections, “we pray that the bill be passed into law as soon as possible.”
“The millions of stakeholders of the private education sector and the linked ecosystem that depend on the continuity of our schools, would be deeply grateful to our senators and congressmen who tirelessly worked in passing this landmark legislation,” Tamayo said.
The proposed measure will make private schools qualified for a concessionary tax rate of 1 percent under the Create law or Republic Act (RA) 11534, instead of the 150-percent increase imposed by a recent regulation by the Bureau of Internal Revenue.
SB 2407 seeks to amend Section 27(B) of the National Internal Revenue Code (NIRC) of 1997 to rectify with finality the flawed interpretation of a provision under the Create Act by BIR Revenue Regulation 5-2021, which imposes a 150-percent increase in taxes on private schools.
“The wealth of discussions by our distinguished senators in the deliberation of this bill would certainly be a rich source of the true legislative intent in further guiding implementors and taxpayers moving forward,” the groups said as they thanked all sponsors of SB 2407.
Tamayo said Minority Floor Leader Sen. Franklin M. Drilon aptly described the overwhelming support on the passage of the clarificatory bill as bipartisan and an issue that crosses party lines for the sake of public interest.
Aside from Cocopea, which represents over 2,500 private educational institutions with over 300,000 school personnel, other groups that signed the statement include: the Davao Colleges and Universities Network; Association of Private, State Colleges and Universities in Region XI; Bicol Association of Private Colleges and Universities; and, the Cesafi Association of Cebu Private Schools.