Dos Hermanas Multi-Purpose Cooperative

March 7, 2008 BIR RULING [DA-143-08] Sec. 109 (L) R.A. 9337; DA-030-2000; DA-112-2007 Dos Hermanas Multi-Purpose Cooperative Talisay City, Negros Occidental Attention: Mr. Rafael Lizares, Jr. Manager Gentlemen : This refers to your letter dated January 22, 2008 requesting for a ruling that your importation of a complete automated poultry equipment system for one (1) Broiler House to augment and boost your production is exempt from the payment of value-added tax pursuant to Section 109 (L) of the National Internal Revenue Code, as amended. It is represented that Dos Hermanas Multi-Purpose Cooperative is primarily engaged in the livestock production, poultry in particular and among others; and that with the current situation in the global market, your cooperative will be importing complete automated poultry equipment system for (1) Broiler House with an area of 60 feet x 100 feet to augment and boost its production to be competitive in the market. In reply, please be informed that Section 109 (L) of the Tax Code of 1997, as amended by Republic Act (R.A.) No. 9337, provides: "(L) Sales by agricultural cooperatives duly registered with the Cooperative Development Authority to their members as well as sale of their produce, whether in its 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 ." (emphasis supplied) Since the imported complete automated poultry equipment system will be used directly for livestock production and feed manufacturing of Dos Hermanas Multi-Purpose Cooperative, the importation thereof is exempt from value-added tax. (BIR Ruling Nos. DA 030-2000 dated January 12, 2000 and DA-112-2000.) This will therefore serve as your authority to secure Authority to Release Imported Goods (ATRIG) without paying the value-added tax on said importations. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service