Statement of Sen. Pia Cayetano welcoming the law which gives preferential tax treatment to all private schools

RA 11635 brings much-needed reprieve to private schools

Statement of Senator Pia S. Cayetano Chair, Senate Ways and Means Committee Principal sponsor, RA 11635

Private schools are the government's partners in education. In this time of pandemic, they need as much assistance as they can get to continue delivering quality education to Filipino learners.

Thus, the enactment of Republic Act (RA) 11635 comes as a welcome development for them amid the uncertainties of the times, as rising COVID-19 cases forced us to restrict face-to-face classes to start the New Year.

This timely measure, which I sponsored, amends Section 27(B) of the National Internal Revenue Code, to clearly indicate that all proprietary educational institutions, whether for profit or non profit, shall enjoy the 10% preferential tax rate.

This shall also allow them to be covered by a provision under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, which reduced the tax rate of such institutions from 10% to 1% starting July 1, 2020 to June 30, 2023.

With this measure, private schools would be given much-needed reprieve to cope with the continuing challenges caused by the pandemic, starting with their own financial viability and sustainability.

It must be emphasized that this law resulted from continuous dialogue and cooperation among the various stakeholders. We worked with the Bureau of Internal Revenue (BIR) and the private schools, led by the Coordinating Council of Private Educational Associations of the Philippines (COCOPEA), to root out the issues and find a common solution.

We need to continue working with our partners in education for long-term solutions in terms of policy and budget, using strategic foresight and futures thinking to help this sector recover from the pandemic, and beyond.

This is part of our country's commitment under Sustainable Development Goal No. 4, which is to ensure inclusive and equitable quality education for all by year 2030.