BIR Ruling

March 4, 1975 The Regional Director Revenue Region No. 14 Bacolod City S i r : This refers to your telegram requesting information whether or not proprietors or operators of centrals should be instructed to withhold the 2% processing tax corresponding to the shares of members of cooperatives who failed to register under Presidential Decree No. 175. In reply, you are informed that shares of members of cooperatives whether re-registered or not under Presidential Decree No. 175 are subject to the 2% tax in accordance with Revenue Memorandum Circular No. 22-71 dated July 15, 1971 which provides, in part, thus: ". . . 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 ." (Emphasis supplied) In view thereof, proprietors or operators of centrals may be instructed to withhold the 2% tax due on the shares of members of said cooperatives. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue TAN 1601-593-5 "TAXPAYERS SHOULD INDICATE THEIR TAN IN ALL COMMUNICATIONS TO THE BIR."