Cooperative Tax Exemption Under RA 9520

Cooperatives in the Philippines by its purpose of existence to help its members and perform quasi government function in poverty alleviation, Social Equity & Justice and practically nation building is also privilege by the Law under Republic Act 9520 in exempting Cooperatives from taxes.

This however has been a consistent subject of dispute between the Bureau of Internal Revenue (BIR) and Cooperatives, practically because according to primary cooperatives the BIR's implementing guidelines are hard  if  not impossible to comply, some cooperatives are  constrained in complying the requirements because of inconsistent documents ask by the Bureau, this allegation is denied by the Bureau who expresses clear listing of requirements in the Implementing guidelines in the application for CTE. Non compliance is the reason why most of the cooperatives were not yet given the Certificate of Tax Exemption (CTE) by the BIR.

Another dispute contested by the Cooperatives is the efficacy of the CTE. While the Cooperatives claim the retroactive effect of the Certificate of Tax Exemption the Bureau of internal Revenue is claiming otherwise. Thus, continuing its assessment to cooperatives
  
The BIR is assessing Tax Deficiency to cooperatives as to their Income Tax, Value  Added Tax or VAT, Percentage  Taxes, Expanded & Final Withholding Taxes, and  Documentary Stamp Taxes. Assessments  made by the BIR are similar to Corporations, as if  cooperatives are corporations. 

So what's your opinion Cooperators?

In my next article I will cite my opinion why Cooperatives should still be exempt from Taxation