Angara pushes tax relief for parents overburdened by college tuition

Noting that it is already the season for enrollment, Senator Sonny Angara yesterday prompted the Senate to approve the bill that would provide tax relief to parents burdened by college tuition.

Angara, a staunch education advocate, was referring to Senate Bill No. 131, also known as the “Family Tax Relief Act,” which seeks an amendment to Section 34 of the National Internal Revenue Code of the Philippines by allowing payments for tertiary education tuition fees and allied educational expenses not exceeding R40,000 as tax deductions from the gross income of an individual.

“This bill seeks to help our people by providing that matriculation fees for tertiary education and allied expenses should be tax deductible from the gross income of a taxpayer,” Angara said.

Angara, who chairs the Senate committee on ways and means, lamented that up until now, access to tertiary education remains problematic and elusive.

The senator pointed out that an annual poverty indicator survey released by the National Statistics Office (NSO) in 2011 shows that six (6) million out of 39 million Filipinos aged between six and 24 are outof-school youth or those who are not attending formal school or have not finished college or post-secondary courses.

Thus, his call for the approval of his proposed tax relief measure which would make tertiary education widely accessible to Filipinos especially for those who can’t qualify for scholarship grants and other assistance.

“Such initiative is also a way of encouraging the parents to send their children to school and for working students to continue their education because of the tax incentives they could get,” he emphasized.

Based on the bill, tertiary education shall include post-secondary courses from higher educational, technical, and vocational institutions.

He said the purpose of tax deductions is to decrease the taxable income, thereby, increasing the net income or the take-home pay of the taxpayers.

Citing Malaysia as an example, Angara explained that the allowable deduction on educational expense is up to 4,000 to 5,000 ringgit or equivalent to R60,000 to R70,000.

He also said that in Thailand, parents are granted, aside from tax deductions, an additional 2,000 baht or R3,000 per child, for educational allowance.

The lawmaker also said that in the United States, tuition and related fees deductible is up to a maximum of $4,000 or nearly R180,000 to the income of the taxpayer who shouldered the expense for his/her own, or for the spouse, or for the dependent.

He said whatever savings the family gets from the proposed law, can be used to shoulder other necessary expenses like food, transportation costs and other basic needs of their children who are studying.

“We should not see this proposal as a possible revenue loss for the government. We should look at the bigger picture and think of the additional college graduates our country would produce and the significant contributions they could offer in the not so distant future,” he stressed.