BIR Ruling

January 29, 1973 Mr. Roberto Roces President, Iloilo Capiz Sugar Planters Cooperative Marketing Association, Inc. Iloilo City S i r : In reply to your telegram to the President of the Philippines dated January 8, 1973 requesting restoration of the tax exemption allegedly granted to Iloilo Capiz Sugar Planters Cooperation Marketing Association, Inc., I have the honor to inform you that if your cooperative association is organized under the provision of Act No. 3425, it is exempt from the merchant's sales tax, the income tax, and all other percentage taxes of whatever nature and description. (Section 48, Act No. 3425, as amended by Rep. Act. No. 702). Among the percentage taxes contemplated under the aforesaid exemption is the 2% miller's tax imposed by Section 189 of the Tax Code. However, the shares of all the members of your association are subject to the said 2% tax pursuant to Revenue Memorandum Circular No. 22-71 dated July 15, 1971 pertinent portion of which reads as follows: ". . . . Proprietors and operators of sugar mills and centrals shall withhold and pay to the Commissioner of Internal Revenue the 2% tax due on the shares of all the planters or owners of the sugar cane, without exception whatever and irrespective of whether or not their sugar cane are caused to be milled by their respective association in their names or in the name of their association." aisa dc Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue