Friday, October 14, 2016

TAX: THREAT ANEW TO CO-OPS





Cooperatives oppose repeal to tax exempt privilege anew

  • October 14, 2016
  • VENUS MAY H. SARMIENTO
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DAGUPAN CITY, October  14 (PIA) – Cooperatives in Ilocos region is uniting again in one voice to oppose the repeal of the law granting tax exemption privileges to this sector.

Executive Director Ray Elevaso of the Cooperative Development Authority said cooperatives are facing a great threat anew as the Congress under the new administration is once again studying  to put cooperatives under taxation through the repeal of Articles 60 and 61.

It can be recalled that in September 2015, cooperative members were enjoined  to wage a massive campaign to oppose the proposed bills on the Rationalization of Fiscal Investment Incentives, pending in the House of Representatives and the Senate.  The repeal of Articles 60 and 61 of Republic Act 9520 or the Cooperative Code of the Philippines embodies the deletion of the provisions granting cooperatives tax exemptions.

“We are under threat again because there is a move anew to remove the tax exemption privilege for cooperatives. We must there fore unite to show that CDA is against poverty,” Elevaso said during the opening of the regional cooperative month celebration held in Dagupan City.

Elevaso said cooperatives are voluntary organizations of people who want to improve their economic lives by their own initiatives and by their own resources.

For his part, CDA Chairman Orlando Ravanera said there is no need for the repeal as cooperatives are taxed in so many ways including education and training.

In Region I alone, the total amount of tax withheld reached P53,774. 794.  This includes taxes withheld for employees’ salary  (P25 million), honorarium (P11 million), interest in share capital (P8 million) and others (8 million).

“Tax is the lifeblood of the government, however, programs should bow down to the principles of social justice,” Ravanera said during a press conference with Pangasinan media.

Articles 60 and 61 of Republic Act 9520 give cooperatives tax-exemption privileges. Among the non-taxable incomes of cooperatives are those derived from transactions with their members.

Also, cooperatives with assets of not more than P10 million are exempted from “all national, city, municipal or barangay taxes. They are also exempt from customs duties, advance sales or compensation taxes on their importation of machineries, equipment and spare parts used by them.”

The creation of the CDA is mandated in section 15, Article XII of the Constitution, which makes it a policy of the State “to promote the viability and growth of cooperatives as instruments of equity, social justice and economic development.”  (JNPD/VHS/PIA-1,Pangasinan)

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