Bencyrus Ellorin
LEADERS of different cooperative federations and unions vehemently expressed opposition to the proposed bills in both houses of Congress that seek to repeal Articles 60 and 61 of Republic Act 9520 also known as the Cooperative Code of the Philippines, which give cooperatives tax exemption privileges.
House Bill 2765 authored by Rep. Gabriel Luis Quisumbing (6th district, Cebu) and Senate Bill 2048 authored by Sen. Loren Legarda expressly propose the provisions in the Cooperative Code of the Philippines granting tax exemption privileges to cooperatives.
In a recent meeting called by the Philippine Cooperative Center (PCC), the Apex organization of the cooperative movement, the country’s cooperative sector represented by leaders of various cooperative federations and unions from around the country agreed to campaign against provisions in the bills on the Rationalization of Fiscal Investment Incentives that would abolish cooperative tax exemption.
PCC Chairman Hamilcar Rutaquio said they will be launching a massive, nationwide campaign to oppose the passage of such bills which according to him will “kill the cooperatives” nationwide. He added that millions of members of various cooperatives in the country will participate in a series of mass actions in Manila and key cities nationwide to oppose such efforts to pass the said measures in Congress.
Rutaquio stressed that the tax exemption privileges is a social justice measure and can never be considered as fiscal incentive to businesses.
Articles 60 and 61 of Republic Act 9520 give cooperatives tax exemption privileges, among the non-taxable income of cooperatives are those derived from transactions with its members among others.
PCC Vice Chairperson and Chairman Emeritus and former Apec Partylist Representative Ponciano Payuyo said such move is misplaced and defeats the role of cooperatives.
The proposed Fiscal Investment Incentives law, Payuyo said should only include investment promotions agencies (IPAs), and cooperatives are not among those.
In a position paper submitted by the CDA to the House Committee on Ways and Means which is deliberating on three House Bills on the Rationalization of Fiscal Investment Incentives chaired by Marikina 2nd District Rep. Romero Quimbo, it said that repealing the tax exemption of cooperatives “will defeat the very intent of the 1987 Constitution.”
It added that “cooperatives are voluntary organizations of people who want to improve their economic lives by their own initiatives and using their own resources.”
Records from the CDA show that there are 24,652 registered cooperatives in the country as of December 2014, with over 13 million individual members.
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