FICCO supports “No to the Repeal of Cooperative Tax Exemptions”

Posted on Posted in FrontNews

TAX EXEMPTION FOR COOPERATIVES REMAIN

 

FICCO among the cooperative sector joined the opposition of the proposed lifting of tax exemption privilege granted to cooperatives. Sessions of collective discussions were attended in the House of Representative- Coop NATCCO Party and attendance to the Cooperative Sector Position on Government Tax Reform Initiative initiated by the Cooperative Development Authority.

On Wednesday, May 24, 2017, House Majority Leader Rodolfo Fariñas confirmed that Tax (VAT) exemption for cooperatives will be retained in the proposed comprehensive tax reform package as the House of Representatives approved on its second and third reading, following strong opposition to its repeal.

As a result, First Community Cooperative is entitled to the following tax exemptions and incentives provided under Article 60 of Republic Act No. 9520, as implemented by the Joint Rules and Regulations Implementing Articles 60, 61 and 144 of RA No. 9520:

a.) Exemption from Income Tax on income from CDA-registered operations;

b.) Exemption from Value-Added Tax on CDA-registered sales or transactions;

c.) Exemption from Percentage Tax;

d.) Exemption from Donor’s Tax on donation to duly accredited charitable, research and educational institutions, and reinvestments to socio-economic projects within the area of operation of the cooperative;

e.) Exemption from Excise Tax for which it is directly liable;

f.) Exemption from Documentary Stamp Tax: provided, however, that the other party to the taxable document/transaction who is not exempt shall be the one directly liable for the tax;

g.) Exemption from payment of Annual Registration Fee of Five Hundred Pesos (P500.00); and

h.) Exemption from all taxes on the transaction with insurance companies and banks, including but not limited to 20% final tax on interest deposits and 7.5% final income tax on interest income derived from a depository bank under the expanded foreign currency deposit system.

With the exemption of the Cooperatives in the Tax Repeal, they can perform their duties which are beneficial to their respective members and to the community which includes the Remaining Net Surplus shall be made available to the members in the form of interest on share capital and patronage refunds, not as realized income but rather savings obtained by members in availing of services from their respective cooperatives.

Our battle against the proposed resolution gains positive pronouncement as the Tax exemption privilege remains. This means FICCO’s advocacy to lift the standard of living and quality of life of our cooperative members will soar continuously because of the effort and prayer of all concerns.