Sugar planters bewail VAT imposition on sugar coops
BACOLOD CITY -- Thirteen heads of sugar planters associations here have questioned the move of Bureau of Internal Revenue (BIR) OIC Regional Director Rodita Galanto imposing Value Added Tax (VAT) on sugar cooperatives.
These sugar leaders cited RA 8424, the Tax Reform Act of 1997 which has institutionalized the exemption of cooperatives on VAT under Section 109 (r) which includes the sales by agricultural cooperatives duly registered with the Cooperative Development Authority to their members as well as sale of their produce, whether it is original state or processed form, to non-members, their importation of direct farm inputs, machineries and equipment including spare parts thereof, to be used directly and exclusively in the production and/or processing of their produce.
The sugar leaders came up with a position paper to question the alleged whimsical imposition of the said taxes by BIR. The signatories to the position paper are: Jaime G. Golez, President of the SAGESPLAS Association; Damian L. Pison, Chairman of the APP-Negros Farmers MPC; Lucio Ma. B Barcelona, Jr., Chairman of ISEPI Multi-Purpose Cooperative; Atty. Arsenio Al Acuna, Chairman of the Negros del Norte Planters Association, MPC; Ramon D. Peñalosa, Jr., Chairman, Negros Agricultural Entrepreneurs MPC; Luis Miguel C. Trebol, Chairman of the SAGESPLAS Multi Purpose Cooperative; Eduardo D. Gargar, Chairman, USETPAI Multi Purpose Cooperative; Jose Ma. Villanueva, Chairman, Dos Hermanas Multi-Purpose Cooperative; Fr. Armando B. Onion, Chairman, Ma-ao Parish Multi-Purpose Cooperative; Miguel S. Hinojales, Jr., Chairman, Negros Sugar Farmers MPC; Primo Esleyer, Chairman, Negros Sugar Farmers MPC; Paul M. Monfort, Chairman of the Sugarcane Growers MPC and Jose V. Ledesma IV, Chairman, VMC Farmers Cooperative, Inc.
Galanto however insists on collecting advance VAT on exempted agricultural multi-purpose cooperatives and claiming that the same is voluntary payment of the farmer-members.
She has collected VAT on the produce of members' cooperatives, based on the 60-40% ratio where the 60% produce is subjected to advance VAT.
Sugar leaders claim that the actions of Galanto are whimsical and not supported by legal basis. "If allowed to continue, our agricultural cooperatives in sugar industry will be unjustly taxed," they claimed.
"Our agricultural cooperatives are unduly harassed by the BIR Regional Director who insists on her whimsical impositions in implementing the law. We do not want to create confusion on our recovering industry, our Sugar Industry. What we need are the clear cut guidelines for our farmers to use as basis in planning their production and marketing. If we do not put an end to this seemingly abuse of discretion of the BIR OIC Regional Director, the sugar industry may again experience the Dark Days," the sugar leaders said.