2. Mandate of The 1987
Constitution
ART. II DECLARATION OF PRINCIPLES AND STATE POLICIES
Section 20. The State recognizes the indispensable role
of the private sector, encourages private enterprise, and
provides incentives to needed investments.
!
3. Education (Art. XIV)
Section 1.
The State shall protect and promote the right of all
citizens to quality education at all levels, and shall take
appropriate steps to make such education accessible to
all.
Section 2.
The State shall establish, maintain, and support a
complete, adequate, and integrated system of education
relevant to the needs of the people and society;
4. Education (Art. XIV)
Section 4.
The State recognizes the complementary roles of public
and private institutions in the educational system and
shall exercise reasonable supervision and regulation of
all educational institutions.
Section 5.
The State shall assign the highest budgetary priority to
education and ensure that teaching will attract and retain
its rightful share of the best available talents through
adequate remuneration and other means of job
satisfaction and fulfillment.
5. “All revenues and assets of non-stock, non-profit
educational institutions used actually, directly,
and exclusively for educational purposes shall be
exempt from taxes and duties. Upon the
dissolution or cessation of the corporate
existence of such institutions, their assets shall
be disposed of in the manner provided by law.
6. “Proprietary educational institutions, including
those cooperatively owned, may likewise be
entitled to such exemptions, subject to the
limitations provided by law, including restrictions
on dividends and provisions for reinvestment.
10. Income of Non stock and non profit PEIs are already
exempt from TAXES and Duties
“Proprietary educational institutions, including
those cooperatively owned, may likewise be
entitled to such exemptions, subject to the
limitations provided by law, including restrictions
on dividends and provisions for reinvestment.” -
Constitution
✄ ₽ $
Proprietary PEIs – tax exemption is not prohibited but
there must be a law.
11. TAXATION PRINCIPLES
✘Taxation raises income to
defray the necessary
expenses of the
government. It is merely a
way of apportioning the cost
of the government among
those who in some
measures are privileged to
enjoy its benefits and,
therefore, must bear its
burdens. (Am Jur., J. Cooley)
✘it is a mode by which
government make
exactions for revenue in
order to support
their existence and carry
out their legitimate
objectives (Tax Law and
Jurisprudence by Justice
Vitug, 2000).
12. ✘It is the inherent power by
which the sovereign state
imposes financial burden
upon persons and property as
a means of raising revenues
in order to defray the
necessary expenses of the
government
13. “Taxes are assessed for the purpose of
generating revenues to be used for public needs.
Taxation itself is the power by which the State
raises revenue to defray the expenses of the
government. Thus, the government could levy
proportionate forced contributions among
persons, property, or exercise of a right or
privilege through its legislature, for public
purpose. Taxation Volume 1: General Principles, Domondon, 2009
ed.
14. “As understood in the traditional sense, public purpose
or public use means any purpose or use directly
available to the general public as a matter of right.
Thus, it has also been defined as an activity which will
serve as benefit to [the] community as a body and
which at the same time is directly related function of
government.
Yap v. Commission on Audit, G.R. No. 158562, 23 April 2010;
16. “Exempt income of proprietary
schools when :
Income is
Actually,
Directly, and
Exclusively
used for
Educational
purposes
Source is
from
educational
activity
18. AUTHORITY OF LOCAL GOV’T
✘Local Government has the power to regulate the activities and trade
within their jurisdiction. One way of regulating is through issuance of
the business/mayor’s permit. This authority of the LGU to issue permit
is sourced from Section 455 of the Local Government Code, which
enumerates the powers and duties of the local chief executive, viz:
24. Incentives to private education institutions
have been a long time policy embodied in
BP 232 or Education Act of 1982. It is the
policy of the State that the government
shall contribute to the financial support
of educational programs pursuant to
goals of education as declared in the
Constitution.
25. INCLUDE SHS
THE Subsidies contemplated under E-GASTPE does
not contemplate subsidies to Senior High School. The
basis of granting SHS Voucher is under RA 10533,
Section 10.
26. MAKE THE EXISTING EDUCATION
SERVICE CONTRACTING (ESC)
SUBSIDY PORTABLE
(LIKE SHS VOUCHERS)
X x x x x x
27. EXTEND TSS TO SHS
RA 10533 merely extended the
subsidies to qualified students.
Teacher Salary Subsidies (TSS)
must also be extended to SHS
teachers.
Will this apply to non-let
passers?
28. EXCLUDE TSS FROM INCOME
OF TEACHERS
TSS is a government subsidy.
Hence, this should not be subject
to tax as this will result to passing
government money from one
pocket to another.
29. LEGISLATE PEAC-FAPE AS THE MANAGER
OF THE PROGRAM
Republic Act 8545 allows DepEd to engage the services of
any qualified entity for the implementation of Expanded
Government Assistance to Students and Teachers in Private
Education programs. Over time, the PEAC-FAPE is able to
perfect an integrated system and facilities allowing DepEd
to extend its assistance to various regions and realize the
purpose of the law in the most cost-effective manner.
Since then, DepEd has been continuously engaging the
services of PEAC-FAPE. The latter effectively manages
various government assistance programs, such as but not
limited to, Education Service Contracting (ESC), and
Teacher Salary Subsidies (TSS).
30. CONDITIONAL 70—20%
Add provision:
HOWEVER, THE 70%-20% ALLOCATION
REQUIRED UNDER PARAGRAPH (2) SHALL NOT
APPLY AS A CONDITION FOR TUITION
INCREASE, IF THE SAID INCREASE IN
TUITION HAS RESULTED TO A DECREASE IN
THE NET INCOME OF THE SCHOOL COMPARED
TO THE PREVIOUS ACADEMIC YEAR.”