BIR Ruling

October 23, 1973 The Revenue Director Revenue Region No. 13 Bureau of Internal Revenue Cebu City S i r : The Sugar Producer' Cooperative Marketing Association, Inc. (SPCMA) wrote this Office to the effect that you have issued assessments against its members for the 2% sugar processing tax covering the period 1960-1970. For your information, Revenue Memorandum Circular No. 22-71 dated July 15, 1971 which sustained the ruling of this Office dated September 9, 1970 revoking the exemption of planter-members of sugar producers cooperative marketing associations from the 2% sugar processing tax is to be given only a prospective application. In fact in the letter of this Office dated August 23, 1971 addressed to Messrs. San Juan, Africa, Gonzales and San Agustin, counsel for SPCMA, it was held as follows: "As regards your oral query regarding the effectivity of the ruling holding planter-members of cooperative marketing associations liable for the 2% tax, you are advised that where the association and its planter-members had previously been granted exemption from the payment of the 2% tax after verification that the association caused sugar canes of planter-members to be milled under a marketing agreement and power of attorney similar to that involved in the case of Calamba Sugar Planters' Cooperative Marketing Association, Inc. versus the Collector of Internal Revenue (C.T.A. Case No. 216, January 5, 1957), the ruling is prospective in operation and therefore, effective July 15, 1971. Accordingly, assessments issued to such cooperative marketing associations and/or planter-members thereof as 2% tax on the share of the planter-members in the sugar milled by the sugar mill or central during the periods prior to July 15, 1971 shall be revoked and countermanded." You are, therefore, advised to desist from enforcing the collection of your assessments by distraint and levy and to countermand the same. cdtech Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue TAN-1601-593-5