20% Final Withholding Tax on Interest Due from Any Philippine Currency Bank Deposits

December 2, 1988 BIR RULING NO. 571-88 24-a 369-88 571-88 Gentlemen : This refers to your letter dated September 14, 1988 requesting in behalf of your client, Porac Poultry and Livestock Raisers Cooperative, an enterprise registered with the Bureau of Cooperatives Development, a ruling on its liability to the following taxes, viz: (a) income tax (b) value-added tax and (c) 20% withholding tax on interest on bank deposits as well as their effectivity and as to whether its tax exemption privileges still exist. In reply, please be informed that Executive Order No. 93 which took effect on March 10, 1987 withdrew all tax exemptions granted to Government and private entities. However, implementation of said Executive Order insofar as electric, agricultural, irrigation and waterworks cooperatives are concerned was suspended until June 30, 1987. (Memorandum Order No. 65 dated January 21, 1987 of the President) Accordingly, the tax exemption privilege of your client expired as of June 30, 1987. Such being the case, effective July 1, 1987, your client shall be subject to the corporate income tax pursuant to Section 24(a) of the Tax Code as amended and to the 20% final withholding tax on the interest due to it from any Philippine currency bank deposits, pursuant to Section 24(e) of the same Code. However, if your client is engaging in the sale of livestock and poultry of a kind generally used as, or yielding or producing for human consumption, said sales are exempt from the value-added tax, pursuant to Section 103(b) of the Tax Code, as amended by Executive Order No. 273. Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner