BIR Ruling [DA-339-04]

June 23, 2004 BIR RULING [DA-339-04] R.A. No. 6938; 13-99 Batangas Integrated Sugar Planters Multi-Purpose Cooperative Corner M.K. Lina Street and Guadalupe Subd. Lipa City Attention: Mr. Cornelio V. Toreja Chairman Gentlemen : This refers to your letter dated December 12, 2003 requesting exemption from the imposition of one (1%) percent withholding tax on Production of Sugarcane (raw sugar). cHDAIS It is represented that Batangas Integrated Sugar Planters Multi-Purpose Cooperative (BISPMC) is a primary agricultural cooperative with Confirmation of Registration No. MLA-C-611 dated April 19, 1991 issued by the Cooperative Development Authority (CDA); that the objectives and purposes for which the cooperative was formed are those stated in its Articles of Cooperation; that you have submitted to this Office in support of your request and in compliance with Section 8 of Revenue Memorandum Circular No. 41-98 dated June 18, 1991 the following documents, viz. : (1) Confirmation of Registration No. MLA-C-611 issued by the CDA; (2) Articles of Cooperation and By-Laws; and (3) Certification that BISPCMA is transacting business only with its members; that at least 25% of the net savings of the cooperative is returned to its members in the form of interest and patronage refund; and that BIR Ruling No. DA-333-2000 dated August 30, 2000 was issued in favor of BISPCMA exempting the same from the imposition of Value Added Tax on its sales to its members, as well as sale on its produce, whether in its original state or processed form to non-members, amongst others. Based on the foregoing, and since you are a primary agricultural cooperative transacting business with members only, you are exempt from all taxes and fees imposed under the internal revenue laws and other tax laws, pursuant to Article 61 of the Cooperative Code. Considering that the one (1%) withholding tax is an internal revenue tax, BISPMC is exempt from the imposition thereof. 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. AETcSa Very truly yours, Commissioner of Internal Revenue By: (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service