2nd tax package could lead to higher tuition, warns Bam
The second tax reform package pending in the Senate could drive up the cost of tuition and other fees, Sen. Bam Aquino warned on Wednesday as he vowed to oppose the provision that removes the tax perks that nonprofit schools currently receive.
The measure, sponsored by Senate President Vicente Sotto III, deletes the provision in the National Internal Revenue Code (NIRC) that imposes a mere 10-percent tax on the taxable income of nonprofit educational institutions and hospitals.
Instead, these institutions may be taxed 25 percent of their income, doubling the current rate, Aquino pointed out.
The bill amends the NIRC provision to reduce the income tax on domestic corporations from 35 percent to 25 percent, and removes the preferential tax rates that certain sectors enjoy.
Burden to families
Aquino said removing the preferential tax rate for nonprofit educational institutions would drive up tuition and other fees. It would also leave schools with less money to invest in quality education, he added.
“In the end, the families who send children to school would shoulder the burden and tuition will increase,” he said.
This would be another hardship for families who are already reeling from the rising cost of basic goods, he added.
Aquino called for support for his pending bill that seeks to suspend the excise taxes on fuel under the Tax Reform for Acceleration and Inclusion Act when the average inflation rate surpasses the annual inflation target over a three-month period.
