distance learning

Bills seeking tax exemption for e-learning gadgets filed in Congress

Jacob Reyes

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Bills seeking tax exemption for e-learning gadgets filed in Congress

LIMITED. Public school students at Barangay Poblacion, Mandaluyong City struggle on their first day of distance learning during the opening of classes for school year 2020-21, on Monday, October 5, due to poor internet connection and getting used to mobile devices.

Photo by Angie de Silva/Rappler

Bills filed by Senator Leila de Lima and Quezon City congresswoman Precious Hipolito Castelo aim to make tablets, laptops, and other tools in distance learning more affordable for ordinary Filipinos

Two lawmakers have filed bills in the House of Representatives and the Senate seeking tax exemption for gadgets and materials to be used in e-learning. 

Both proposed measures seek to make electronic gadgets used in distance learning more affordable to the public.

Senator Leila de Lima filed a bill seeking value-added tax (VAT) exemption for e-books, e-learning applications, gadgets, and computers to be used in distance learning,

Senate Bill No. 1872, filed on Tuesday, October 6, amends Section 109 (1) of the National Internal Revenue Code of 1997. In the proposed measure’s explanatory note, De Lima said the state has the task of protecting and promoting the right to quality education.

The proposed measure is intended to be a temporary exemption during the country’s period of recovery from the COVID-19 pandemic, De Lima said in a message her staff relayed to Rappler.

Quezon City 2nd District Representative Precious Hipolito Castelo filed a similar bill on August 19. 

House Bill No. 7436 seeks to exempt electronic gadgets for distance learning from all taxes, duties, fees, and other charges.

Both lawmakers said their bills are an investment in education.

Online classes

School year 2020-2021 officially began Monday, October 5.

The Department of Education (DepEd) implemented distance learning in which lessons are delivered to students through modular learning, online classes, and TV and radio broadcasts.

Online classes require students and teachers to use gadgets such as tablets and laptops. DepEd released minimum specifications for these gadgets earlier this year.

“Electronic gadgets with the necessary specifications for studying are not affordable for everyone. Taxes such as customs duties and value-added tax (VAT) make these gadgets more expensive,” Castelo wrote in her bill’s explanatory note. 

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De Lima said that “in exempting educational tools and gadgets that will be utilized by the students and teachers…from VAT, prices of these essential commodities which we can now consider as essential, will be reduced significantly, therefore making them cheaper and more obtainable.”

“With the pandemic…creating further stratifications that make the poor suffer even more – families losing their livelihood and homes – the instruments that are vital for e-learning remain beyond their reach,” said De Lima, who filed the bill while in detention in Camp Crame.

De Lima has been detained in a facility at the Philippine National Police headquarters Camp Crame for over 3 years. She was arrested in 2017 over illegal drug charges that the government filed against her after she investigated President Rodrigo Duterte’s drug war.

Tax exemptions and incentives

These tax exemptions, of course, would mean lost government revenue.

De Lima’s office estimated that the government will collect around P3.8 billion in VAT on all consumer electronics sales in the country in 2020. The proposed measure seeks to exempt only gadgets that will be used primarily in distance education.

In a text message to Rappler, Castelo said there is “no information yet from the Bureau of Internal Revenue (BIR) as to the amount of importation the government and private sector will have on these gadgets,” if her bill would be passed and signed into law.

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To make up for revenues the government would lose if the proposed measure becomes law, Castelo said the government “should go after the unpaid taxes [of] POGO (Philippine offshore gaming operators).

“We should come after tax evaders. We should curtail corruption in the two biggest government tax collection [agencies] – the Bureau of Customs and the BIR. Sin tax should be upgraded if needed,” Castelo said.

“We should never put the burden of paying taxes [on] hapless parents amidst the pandemic, who work hard for their children to have an education,” she added. – Rappler.com

Jacob Reyes is a volunteer at Rappler. He is studying AB Communication at the Ateneo de Manila University.

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