MANILA — Tax incentives granted to schools and private partners are helping cushion the impact of rising operational costs, preventing tuition hikes and sustaining investment in education, the Department of Education (DepEd) said.

DepEd Secretary Sonny Angara highlighted that incentives allow schools to better manage higher expenses for fuel, transport, and logistics without fully passing them on to students. “Aligned with President Bongbong Marcos’ priority to shield education from economic volatility, these incentives enable schools and their partners to maximize limited resources and free up funds for teaching and learner support,” Angara said.

Key measures include:

• VAT exemptions: Tuition and other educational services are exempt from the 12% value-added tax, directly reducing costs for families.
• Income tax exemptions: Non-stock, non-profit educational institutions are exempt from income tax if revenues are used exclusively for educational purposes; proprietary schools benefit from a 10% preferential income tax rate.
• Duty- and tax-free imports: Schools may import books and educational materials without paying duties or taxes.
• Renewable energy tax credits: Institutions can claim VAT credits for renewable energy equipment, lowering long-term operational expenses.
• Adopt-a-School donations: Private sector donations are eligible for 150% deductibility, with potential VAT exemptions and donor’s tax exemptions if administrative use requirements are met.
• Workforce training incentives: Companies investing in workforce development can claim a 150% deduction on training expenses, increasing to 175% from January 1, 2028.

Angara emphasized that these incentives align with the government’s push to strengthen private sector participation in education while sustaining affordable access for learners.

“These provisions help schools and partners continue to invest in quality education despite economic pressures,” he said.