Senate OKs on third reading bill exempting poll workers, teachers’ honoraria from tax

A bill seeking to exempt the election period service honoraria and allowances from income tax was approved by the Senate on third and final reading Monday.

Voting 17-0-0, the Senate approved Senate Bill 2520 or the Act Exempting from Income Taxation the Honoraria, Allowances, and Other Financial Benefits of Persons Rendering Service During An Election Period.

SB 2520 seeks to amend Section 32(B)(7) of the National Internal Revenue Code of 1997 as amended.

In her sponsorship speech last week, Senate Ways and Means Committee chairperson Pia Cayetano, citing the statements of the Alliance of Concerned Teachers, said chairpersons of the Electoral Boards and poll clerks also received an additional P1,000 to P2,000 travel allowance for training, which was already released to them.

Meanwhile, election workers, depending on their position (chairperson, Electoral Board Members, Technical Support Staff, etc.) should receive a gross compensation of P4,500 to P12,000.

However, with the imposition of the 20% withholding tax, they will only receive around P3,600 to P9,600 for the services they rendered during the 2022 elections.

"Historically, election honoraria and allowances were not taxed. But the BIR had ruled that such compensation should be subjected to tax and, consequently, to withholding tax," Cayetano noted.

This was not the first time that the honoraria and allowances were subjected to taxation. In the 2018 Barangay and Sangguniang Kabataan Election and in the succeeding 2019 Midterm Election, these were subjected to a 5% professional fee withholding tax.

"Now, in the 2022 election, the [Bureau of Internal Revenue] issued another ruling that since election duties are not a practice of a teacher’s profession, the previous 5% professional fee withholding tax would no longer be applicable, thus, subjecting election honoraria and allowances to 20% withholding tax on compensation," Cayetano said in her sponsorship speech last week.

"Ang hiling ng ating mga guro at ng iba pang nagbibigay ng serbisyo tuwing eleksyon, huwag na silang buwisan dahil napakabigat na ng trabahong kanilang ginagampanan. This measure is a small show of support to our teachers and non-teaching personnel for the services they render, considering that elections are special circumstances that do not happen annually," she added.

Before the conduct of the 2022 national and local polls, several groups of teachers have been appealing to the government as well as the Commission on Elections to exempt their election service honoraria from taxation.

But the Department of Education and the Comelec said that laws should be amended so the honoraria will not be subjected to tax. — Hana Bordey/RSJ, GMA News