Co-ops urged to take advantage of tax-free privilege

MANILA, Philippines –  Co-op Natcco partylist Senior Rep.Jose Ping-ay urged cooperative groups throughout the country to avail themselves of the tax privileges granted them by the Philippine Cooperative Code by acquiring certificates of tax exemptions (CTE) from the concerned government agencies.

Addressing some 5,000 delegates who attended the National Cooperatives Summit at the Araneta Coliseum recently, Ping-ay urged the cooperative leaders and members to assert their new-found privileges and report agencies in their areas of operation that do not comply with the mandate of the Cooperative Code. The code (RA 9520) was passed into law in 2008.

Ping-ay pointed out that under the code, all financial transactions of cooperatives with their members are tax-free provided they have secured a CTE from the Bureau of Internal Revenue. He added that if the cooperative transacts with both members and non-members but has not yet reached the P10-million accumulated reserve fund and undivided net surplus, the said cooperative is still tax-free.

Above the P10-million threshold, only those transactions with non-members shall be taxed.

These items, he said, are clearly written in the implementing rules and regulations of RA 9520.

On top of these, he said that deposits of cooperatives in commercial banks are now free from the 20-percent withholding tax imposed on deposits.

Ping-ay chairs the House commitee on cooperatives development which is tackling amendment-proposals to invigorate and strengthen the Cooperatives Development Authority following calls to amend its charter.