HOUSE OF REPRESENTATIVES 
Quezon City  
NINETEENTH CONGRESS 
Third Regular Session  
House Bill No. _____
______________________________________________________________________ 
Introduced by Representative PABLO JOHN F. GARCIA     
______________________________________________________________________ 
EXPLANATORY NOTE 
This bill seeks to address the pervasive digital divide in the Philippines, where 
internet access and digital literacy vary significantly across regions. Studies reveal that 
only 35% of Filipinos had internet access as of 2023,1 with urban areas enjoying better 
connectivity than rural locations. The National Economic and Development Authority 
(NEDA) has underscored that digital inclusion is critical for economic growth, with the 
digital economy contributing approximately 8.4% to GDP as of 2023.2 To accelerate 
digital development and create equitable access, this bill mandates affordable and quality 
internet for all, empowering citizens and businesses alike to participate fully in the digital 
economy. 
A key element of this bill is a blended finance framework that incentivizes private 
companies to build and expand ICT infrastructure in underserved and remote areas. 
While private sector investment has driven digital advancements in metropolitan regions, 
rural access remains sparse. The International Telecommunication Union (ITU) 
recommends blended financing models to close these gaps.3 This bill aligns with these 
recommendations by offering tax incentives, subsidies, and prioritized access to 
government resources for ICT infrastructure development. Local Government Units 
(LGUs) will be empowered to partner with private sector stakeholders to expedite 
infrastructure projects that fulfill these objectives. 
Additionally, the bill establishes a Digital Literacy Program led by the Department 
of Education (DepEd) and the Technical Education and Skills Development Authority 
(TESDA). Data shows that only 55% of Filipinos are digitally literate, indicating a 
1 https://www.philstar.com/headlines/2023/06/14/2273740/dict-65-philippines-not-connected-internet  
2 https://www.trade.gov/country-commercial-guides/philippines-digital-economy  
3 https://www.chathamhouse.org/2022/12/building-global-prosperity/07-closing-digital-infrastructure-and-
connectivity-gap  
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significant skills gap that could hinder economic competitiveness and social mobility.4 
Digital literacy initiatives will be integrated into educational curricula and community 
programs, equipping citizens with essential skills for the digital economy. Programs like 
Singapore’s Infocomm Media Development Authority (IMDA) have successfully increased 
digital literacy rates to over 80% by targeting all demographic sectors, a model that this 
bill seeks to emulate for inclusive and sustained development. 
To enforce accountability, this bill imposes penalties on non-compliant 
telecommunications providers and private partners. Companies failing to meet agreed-
upon service quality and accessibility benchmarks will face substantial fines, ensuring 
adherence to project timelines and quality standards. Funds collected from these 
penalties will support the Digital Inclusion Fund, earmarked for infrastructure 
improvements and digital literacy efforts across underserved regions. 
This legislation represents a holistic approach to closing the digital divide in the 
Philippines. By leveraging public-private partnerships, enhancing digital literacy, and 
implementing strict compliance measures, the bill aligns with national development goals 
of inclusive growth and economic empowerment. Ensuring digital access for all Filipinos 
not only addresses immediate connectivity gaps but also creates pathways for 
educational attainment, job creation, and socio-economic mobility, fostering a more 
resilient and digitally capable society. 
Rep. PABLO JOHN F. GARCIA 
3rd District, Province of Cebu 
4 https://journalnews.com.ph/house-passes-e-governance-act-for-faster-services-to-the-public/#gsc.tab=0 


HOUSE OF REPRESENTATIVES 
Quezon City  
NINETEENTH CONGRESS 
Third Regular Session  
House Bill No. _____ 
______________________________________________________________________ 
Introduced by Representative PABLO JOHN F. GARCIA     
______________________________________________________________________ 
AN ACT 
PROMOTING DIGITAL INCLUSION THROUGH UNIVERSAL INTERNET ACCESS, 
DIGITAL LITERACY PROGRAMS, AND INFRASTRUCTURE DEVELOPMENT, AND 
PROVIDING FUNDS THEREFOR 
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 known as the “Digital Inclusion Act.” 
Section 2. Declaration of Policy. It is hereby declared the policy of the State to bridge the 
digital divide by providing universal and affordable access to information and 
communication technologies (ICT); establishing ICT infrastructure across the country, 
especially in underserved and unserved areas; improving digital literacy and skills 
development across all sectors of society, especially for marginalized groups; fostering a 
sustainable and equitable digital economy by enhancing e-governance, e-learning, e-
commerce and other digital services; and encouraging private sector participation and 
innovation in the provision of ICT services. The State recognizes that access to ICT is 
essential for inclusive economic growth, social equity, and participation in the global 
digital economy. 
Section 3. Definition of Terms. For the purposes of this Act, the following terms shall be 
defined as follows: 
a. Digital Divide refers to the gap between individuals, households, businesses, and
geographic areas at different socio-economic levels with regard to their access to
ICT, including the internet.
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b. ICT Infrastructure refers to the physical and technical infrastructure needed to 
support information and communication technologies, including but not limited to 
broadband networks, mobile networks, fiber optics, and satellite connections. 
c. Underserved Areas refers to areas where ICT infrastructure exists but is 
insufficient to meet demand. 
d. Unserved Areas refers to areas where ICT infrastructure is not available. 
Section 5. Universal Internet Access Program. The Department of Information and 
Communications Technology (DICT), in coordination with local government units (LGUs) 
and the private sector, shall implement a Universal Internet Access Program to ensure 
that all Filipinos have access to reliable, high-speed, and affordable internet by 2030. The 
program shall include subsidized internet fees for low-income households, students, and 
micro-businesses and incentives to telecommunications companies that will offer 
discounted internet services for low-income households, students, and micro-businesses. 
Section 6. ICT Infrastructure Development. The DICT shall expedite the rollout of the 
National Broadband Plan to ensure the nationwide installation of broadband 
infrastructure, with a focus on underserved and unserved areas. A Digital Infrastructure 
Fund is hereby established to finance ICT infrastructure projects, particularly in rural and 
geographically isolated areas. The fund may also be used to upgrade existing 
infrastructure and integrate new technologies such as 5G, satellite communications, and 
fiber optics. 
Section 7. Digital Literacy and Capacity-Building Programs. The DICT, in coordination 
with the Department of Education (DepEd), the Commission on Higher Education 
(CHED), and the Technical Education and Skills Development Authority (TESDA) shall 
develop and integrate digital literacy programs into the curriculum at all educational levels. 
The DICT shall also conduct nationwide digital literacy campaigns aimed at marginalized 
sectors such as senior citizens, women, persons with disabilities, indigenous peoples, 
and out-of-school youth, to ensure equitable access to digital opportunities. TESDA, in 
collaboration with the private sector, shall offer ICT skills training programs, including 
coding, web development, data analytics, and other relevant fields to meet the needs of 
the growing digital economy. 
Section 8. Blended Finance for ICT Development. The government shall promote and 
facilitate blended financing models to improve ICT infrastructure, increase competition in 
the telecommunications sector, and foster innovation in digital services. Participating ICT 
developers, as duly certified by the DICT and in consultation with the Board of 
Investments (BOI), shall be entitled to the following incentives: 


a. Income Tax Holiday (ITH) - For the first three (3) years of its commercial 
operations, the duly registered ICT developer shall be exempt from income taxes 
levied by the national government. 
b. Duty-free Importation of ICT Machinery, Equipment and Materials - Within the first 
five (5) years upon the issuance of a certification of an ICT developer, the 
importation of machinery and equipment, and materials and parts thereof, shall not 
be subject to tariff duties: Provided, however, That the said machinery, equipment, 
materials and parts are directly and actually needed and used exclusively in the 
ICT facilities is covered by shipping documents in the name of the duly registered 
ICT developers to whom the shipment will be directly delivered by customs 
authorities: Provided, further, That endorsement of the DICT is obtained before the 
importation of such machinery, equipment, materials and parts are made or before 
any sale, transfer or disposition of the imported capital equipment, machinery or 
spare parts is made. 
c. Zero Percent Value-Added Tax Rate. - The sale of duly-certified ICT infrastructure 
shall be subject to zero percent (0%) value-added tax (VAT), pursuant to the 
National Internal Revenue Code (NIRC) of 1997, as amended by Republic Act No. 
9337. 
Section 9. Monitoring and Evaluation. The DICT, in collaboration with the National 
Economic and Development Authority (NEDA) and other relevant agencies, shall monitor 
the implementation of this Act and submit an annual report to Congress on the progress 
of the Universal Internet Access Program, infrastructure development, and digital literacy 
initiatives. 
Section 10. Funding. The amount necessary for the initial implementation of this Act shall 
be charged to the current year’s appropriations of the DICT and other relevant agencies. 
Thereafter, such sums as may be necessary for its continued implementation shall be 
included in the annual General Appropriations Act (GAA). 
Section 11. Penalty Clause. Penalties shall be imposed to any individual, entity, or partner 
found in violation of the following: 
a. Failure to meet service and accessibility standards starting from a fine of not less 
than PHP 500,000 for each month of non-compliance. 
b. Falsification of data, failure to disclose project delays, or concealment of financial 
data will incur a fine of not less than PHP 1,000,000 and potential disqualification 
from future government contracts under the New Government Procurement Act. 
c. Unjustified delays beyond the agreed project timeline shall be penalized with an 
additional fine equivalent to 5% of the project’s total contract value for each quarter 
delayed. 


 
Parties subject to penalties may file an appeal to the DICT within 15 days of the penalty 
notice. The DICT shall resolve appeals within 30 days; however, penalties shall remain 
in effect during the appeal process. 
 
The DICT, in coordination with relevant government agencies, is tasked with the collection 
of fines and enforcement of penalties. Collected fines shall be allocated to a Digital 
Inclusion Fund dedicated to furthering the objectives of this Act, particularly in rural and 
underserved areas. 
 
Section 13. Implementing Rules and Regulations. The DICT, in coordination with relevant 
agencies, shall issue the necessary rules and regulations for the effective implementation 
of this Act within ninety (90) days from its effectivity. 
Section 14. Separability Clause. If any provision or part of this Act is declared 
unconstitutional or invalid, the remaining provisions shall not be affected and shall remain 
in full force and effect. 
Section 15. Repealing Clause. All laws, executive orders, administrative orders, rules, 
regulations, or parts thereof inconsistent with the provisions of this Act are hereby 
repealed or modified accordingly. 
Section 16. Effectivity. This Act shall take effect fifteen (15) days after its publication in 
the Official Gazette or in two (2) newspapers of general circulation. 
Approved,