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THIRTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
First Regular Session 
S E N A T E  
S. No. 
1387 
Introduced by Senator Biazon 
EXPLANATORY NOTE 
This bill seeks to grant tax exemption to public school teachers who have 
accepted temporary appointment or as substitute within the first five years following their 
permanent appointment. 
Undoubtedly, there is a great demand now for public school teachers in the rural 
areas especially considering the shortage brought about lately by the exodus of teachers 
for overseas employment. However, the difficulties of life in the rural areas, such as in 
transportation, lodging or insurgency problem, to mention only a few, have discouraged 
teachers to be employed there. 
Thus, it is the sincere belief of the undersigned that with this privilege of tax 
exemption on salary, more new teachers will be encouraged to accept teaching job in 
remote areas, even as substitutes, where usually vacancy of temporary nature exists. This 
is because public school teachers in this category either will get an equal take home pay 
or a regular public school teacher may even get more than latter due to the savings they 
get from being tax exempt. This bill will encourage too, those substitute teachers to stay 
on their assignments even after becoming permanent teachers because of the extended tax 
exemption for the next five years. It cannot be ignored that the tax exemption on the 
income of teachers will mean extra money for them to spare for their other needs. 
For the foregoing considerations, the approval of this bill is urgently requested. 
N 
Senator 


. 
THIRTEENTH CONGRESS OF THE REPUBLIC ) 
First Regular Session 
) 
OF THE PHILIPPINES 
1 
’04 XI. -2 
A9 :06 
S. No. 
Introduced by Senator Biazon 
AN ACT 
EXEMPTING FROM TAX ALL ALLOWANCES AND BENEFITS 
GRANTED TO PUBLIC SCHOOL TEACHERS, INCLUDING 
THOSE IN THE STATE COLLEGES AND UNIVERSITIES 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Short Title. - This Act shall be referred to as “The Public School 
Teachers’ Tax Incentive Act”. 
SEC. 2. Statement of Policy. - It is hereby declared the policy of the State to 
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 ofjob satisfaction and fulfillment. [(Art. XIV, Sec. 5 (5)]. 
It is further declared a policy and commitment of the State to promote and 
improve the economic status of all public school teachers, including those in State 
colleges and universities by increasing their take home pay through exemption from tax 
all allowances and benefits granted to them. 
SEC. 3. Exclusions from Gross Income. -All allowances and benefits granted to 
public school teachers, including those in the State colleges and universities at all levels, 
shall not be included in the computation of gross income and shall be exempt from 
taxation under Title 111, Chapter VI of Republic Act No. 8424, otherwise known as the 
“Tax Reform Act of 1997”. 


SEC. 4. Exemption from Attachment, Levy, and Execution. - All benefits and 
allowances referred to herein shall likewise not be subject to attachment, levy, and 
execution. 
SEC. 5. Rules and Regulation. - The Commissioner of the Bureau of Internal 
Revenue is hereby authorized to promulgate such rules and regulations as may be 
necessary to implement the provisions of this Act. 
SEC. 6. Repealing Clause. - All laws, decrees, executive orders, letters of 
instruction, letters of instruction, letters of implementation, rules and regulations, and 
other issuances inconsistent with any provision of this Act are hereby repealed, modified, 
superseded or amended accordingly. 
SEC. 7. Separability Clause. - If any provision of this Act of the application of 
such provision to any person or circumstance is held invalid for any reason, the 
remainder of this Act or the application of such provision to other persons or 
circumstances shall not be affected thereby. 
SEC. 8. Effectivity. - This Act shall take effect fifteen (15) days after its 
complete publication in any two (2) newspapers of general circulation. 
Approved,