Profit margins probed as govt considers tutorial school taxes | Bangkok Post: learning

Education officials are looking into concerns over tutorial schools overcharging parents and students.

IT ALL ADDS UP: Tutorial schools’ profit margins must not exceed 20% of their total operating costs, under the 2007 Private School Act.

Chanwit Tubsuphan, secretary-general of the Office of the Private Education Commission (Opec) overseeing tutorial school operations, said under the 2007 Private School Act, the profit margins of non-formal education outlets registered with the Education Ministry must not not exceed 20% of their operating costs.

Tutorial schools exceeding this profit ceiling would face a closure order, Mr Chanwit said.

However, the law covers only tutorial schools registered with the Education Ministry. Those that are unregistered _ which are not allowed to use the word "school" in their name _ always reap profits from students, he said.

The issue surfaced last week when the National Anti-Corruption Commission proposed that the cabinet tax tutorial schools, which they said earned several billions baht of annual revenue.

The cabinet has ordered more studies into the proposed taxation before going ahead with the scheme.

Prime Minister Abhisit Vejjajiva said he disagreed with the taxation idea. Tutorial schools are regarded as business establishments, but they provide education, which is why the business tax has been waived, he said.

The premier added that the important issue was to find out if the schools were overcharging with their fees.

Sahattaya Sukhasvasti Na Ayudhaya, a mother of two, said she paid tens of thousands of baht each year for her sons' tutorial school fees.

Mrs Sahattaya said she was afraid that the tutorial school operators would pass on the burden to parents by increasing fees if they were taxed.

"I'm ready to pay for the tuition cost if it helps my sons perform better in their studies, but the cost should not be too high," she said.

Chitra Chantrakul, president of the Association of Private School Administrator for Non-formal Education, said non-formal education establishments had to shoulder heavy operating costs without any government subsidy.

"The public thinks that tutorial schools make a huge profit, but in fact they have a lot of expenditures," she said.

Non-formal education outlets would hold a meeting to discuss the taxation issue on Friday.