Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

FIFTEENTH CONGRESS
First Regular Session

1 ony
H. B. No. * 78

Introduced by HONORABLE JUAN EDGARDO “SONNY” M. ANGARA

EXPLANATORY NOTE

Education plays a significant role in national development. There is therefore a need to
continuously upgrade the standards of education so that it is always in tune with the state of the
art in education.

The government alone cannot single-handedly upgrade the standards of education. To
accelerate the place of our educational development, the government needs the active
assistance of other sectors of society. Although, others have been extending their help to our
educational institutions, this has not been fully realized because of the limitations and
inadequate incentives available under existing laws.

Non-profit and non-stock educational institutions have the benefit of tax exemption as
enshrined in the 1987 Constitution. But these privileges are not sufficient to augment the
operational needs, as well as, the development and upgrading of the school facilities.
Worsening economic conditions and the rapid strides in the development of technology has
made it difficult for non-profit and non-stock educational institutions with their limited resources,
to cope with the prevailing trend.

The Bill seeks to encourage the full support of the non-government sector of our society
and to provide the much needed relief to the non-profit and non-stock educational institutions.
Existing laws grant limited exemption to donations, grants, gifts or contributions to non-stock,
Non-profit educational institutions. To further solicit the active support of this sector to our
educational institutions and its programs, this measure grants FULL TAX EXEMPTION and TAX
CREDITS to willing benefactors. By widening the incentives, the private sector can lend their
unfailing support to our educational institutions and programs towards the achievement of our
national goal of full development.

In consideration of the above premises, the immediate approval of this bill is earnestly

sought.
JUAN EDGARDO “SONNY” M, ANGARA
Representative

Lone District, Province of Aurora


FIFTEENTH CONGRESS OF THE)
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

on

H. B. No, © (0

Introduced by Honorable JUAN EDGARDO “SONNY” M. ANGARA

AN ACT
EXEMPTING FROM TAXATION ALL DONATIONS, GRANTS OR GIFTS TO NON-
STOCK AND NON-PROFIT EDUCATIONAL INSTITUTIONS

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

SECTION 1. Declaration of Policy. It is the policy of the State to encourage the
participation of every member of the society towards the development of our education through
voluntary sharing of resources.

SEC. 2. Notwithstanding any provision of law to the contrary, all monetary contributions
and the equivalent monetary value of properties donated, granted or bestowed to non-stock and
non-profit institutions are tax-exempt and deductible from the taxable income of the donor,
Provided, That such donations, grants, endowments or contributions shall be used actually,
directly, and exclusively for the primary educational purposes of the recipient; Provided further,
That not more than twenty-five (25) percent of the donations, grants, endowments or
contributions shall be used for administrative purposes

SEC. 3. For the purposes of this Act, the equivalent monetary value of properties
donated, granted, endowed or contributed shall be the prevailing fair market value of the
property as determined by the Secretary of Finance and approved by the Bureau of Internal
Revenue

SEC. 4, All laws inconsistent with this Act are hereby repealed or modified accordingly.

SEC. 5. This Act shall take effect fifteen (15) days after its publication in the Official
Gazette or in two (2) national newspaper or general circulation whichever comes first.

Approved,