RMC No. 23-2026, released on March 30, addresses certain provisions in Revenue Regulations (RR) 13-2025, which consolidated the rules for claiming tax incentives under the Adopt-a-School Act (RA 8525), the EBET Framework Act (RA 12063), and the Tax Code, The circular aims to encourage more companies to participate in these programs and help public schools and technical institutions upgrade facilities and training programs.

Key clarifications

Under the EBET Act, only enterprises are eligible to implement EBET programs. The BIR clarified that the term “technical-vocational institutions” in RR 13-2025 refers exclusively to enterprises registered with TESDA to operate an EBET framework. Academic institutions are not covered by this designation.

The circular also provides guidance on calculating tax incentives. “Additional deduction” refers to a deduction on top of the regular allowable deductions under Section 34 of the Tax Code. Until December 31, 2027, enterprises can claim 150% of actual training expenses, which includes 100% of the actual cost plus an additional 50% deduction. Starting January 1, 2028, the additional deduction will rise to 75% of training expenses, subject to a cap of 5% of total direct labor expenses or ₱25 million per year, whichever is lower.

RMC 23-2026 clarifies the treatment of training expenses covered by scholarships. EBET programs may be subsidized through scholarships, with general programs covering training costs, assessment costs, and training support funds, while apprenticeship and upskilling programs cover only training and assessment costs. Only expenses actually incurred and shouldered by the enterprise are deductible, while costs funded by third-party scholarships are excluded. Unclaimed EBET incentives cannot be carried over and are forfeited after the applicable taxable year.

The circular also addresses donations under the Adopt-a-School Program. Tax incentives under EBET and Adopt-a-School are mutually exclusive, meaning enterprises may claim only one type of tax incentive for a particular expense or donation. Private entities that adopt public schools can deduct contributions directly incurred for the program, with an additional 50% deduction. These contributions are exempt from donor’s tax. For foreign donations, VAT and excise tax are assumed by TESDA or the Department of Education and the Commission on Higher Education. Local donations may be subject to VAT if they are considered a “transaction deemed sale” of goods originally intended for sale; otherwise, such transfers are VAT-exempt.

Purpose and Impact

The consolidated regulations and RMC are designed to incentivize companies to actively participate in education and skills development initiatives, helping address the mismatch between the labor market’s needs and the country’s workforce capabilities. Under the Tax Code, registered enterprises may claim a 50% additional deduction on labor expenses and a 100% additional deduction on training expenses incurred during the taxable year. The 100% deduction applies only to training provided to Filipino employees directly engaged in the enterprise’s production of goods or services.

For enterprises implementing a registered EBET framework, RR 13-2025 outlines the specific incentives available to technical-vocational institutions, reinforcing the government’s goal of fostering private-sector collaboration in education and workforce development.

The event was also the first time the Philippine President hosted a Bhutanese leader at the Malacañan Palace.

President Marcos conveyed to the Prime Minister during the meeting that the current efforts to organize the representation for non-resident ambassadors between the Philippines and Bhutan will become more important to enhance ties, according to the Presidential Communications Office (PCO).

The President also expressed elation over the present engagement between the Philippines and Bhutan through the Technical Education and Skills Development Authority (TESDA) for skills training and upskilling of workers.

President Marcos likewise stressed that after the pandemic, there is a realization of the need to forge new partnerships with friends around the world, not only in tourism and cultural exchange, but also in people-to-people, trade, and investment.

Prime Minister Tshering Tobgay, who is visiting Manila to attend the Asian Development Bank’s (ADB) Asia Pacific Food Systems Forum (APFSF) 2026 this March, requested a call on the President on the sidelines of the event.

The Bhutanese leader’s visit is the first in the era of formal diplomatic ties between the Philippines and Bhutan since their establishment on October 6, 2025.

The meeting between the two leaders is an important opportunity for substantive engagement on priority areas of bilateral and broader cooperation.

The Philippines has been exporting commodities to Bhutan that include electronic products, machinery, and transport equipment, as well as woodcrafts and furniture.

Its top import commodities from Bhutan, on the other hand, are wine, fresh grapes, and virgin olive oil.

In terms of tourism, the Philippines welcomed 335 Bhutanese tourists as of November last year. In 2024, there were 380 tourist arrivals from Bhutan.

As for the Filipino diaspora in Bhutan, available information indicates that Filipinos work there as hotel managers.