Tax Exemption on the Shares of Members in the Sugar Milled

March 1, 1960 BIR RULING NO. 110-60 Silay-Saravia Planters' Cooperative Marketing Association, Inc. Silay-Hawaiian Central Occidental Negros Gentlemen: With reference to your letter dated February 10, 1960, I have the honor to inform you that the exemption of that Association from the 2% tax finds application to all its shares in the sugar milled by all centrals with which it has milling contracts. You manifested that some of your members-planters have plantations outside your milling district. For convenience and expediency, the sugar cane in these plantations must of necessity have to be milled by the central of the milling district where they are located. Notwithstanding, however, the Marketing Agreement and Power of comprises all the sugar produced in the latters' plantations and wherever located. As a matter of fact, the quedans issued by the various centrals are issued in the name of the Association. It is obvious from the foregoing, that the Association handles the milling and marketing of the sugar of its members. Under the circumstances, all the shares of your members in the sugar which you caused to be milled by all centrals with which you have milling contracts are exempt from the 2% tax prescribed by Section 189 of the Tax Code. Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue