Recto wants temporary tax break for private schools, hospitals amid COVID-19

Senate President Pro Tempore Ralph Recto proposed that tax collections from private schools and hospitals be suspended for the next two to three years amid the COVID-19 pandemic.

During the period of debates for the Corporate Recovery and Tax Incentives for Enterprises (CREATE) bill, Recto inquired how these private institutions are taxed.

Senate Ways and Means Committee chairperson Pia Cayetano, who was sponsoring the measure, said proprietary educational institutions are taxed a special rate of 10%. The same goes for proprietary hospitals.

"Shouldn't we provide suspension man lang, let's say, dahil COVID ngayon, pandemic, the next two to three years? Pag nag-recover bayad na ulit sila," Recto said.

Around 800 private schools in the country have suspended operations due to the economic downturn brought about by the COVID-19 pandemic, according to the Department of Education.

Further, Recto said that private hospitals need a temporary tax break to help them upgrade their facilities and equipment.

There should likewise be temporary suspension of other taxes on importation and sale of medicines and medical equipment, according to the senator.

Cayetano said she would personally agree but the Department of Finance's position was that it will have to compute the potential foregone revenues.

She added that based on previous consultations with stakeholders, authorities would rather collect taxes and then give it back in a targeted way rather than apply a blanket provision of tax collection suspensions for certain sectors. — BM, GMA News