Can’t tax coops

In his efforts to perhaps quell the widespread rumor that he would run for mayor come the May 9, 2022 national and local elections, Cebu City Mayor Mike Rama, at every chance to talk to the public, assures that his political relationship with Mayor Edgardo C. Labella is intact.

On Monday, during the dinner and awards night of the Coop Month and Christmas Party in a downtown hotel sponsored by the Cebu City Cooperative Development Council (CCCDC), Rama left early after delivering his speech. Someone complained of indigestion.

He arrived when the two young female singers from Lamac Cooperative were singing while the coop members were eating. The entertainment was disrupted when Rama took the microphone and started talking. He was not pleased to see that there were several empty tables. Organizers say they reserved for 400 persons, but only a few attended.

Rama, who was walking around while talking with someone recording his speech on a smart phone, again talked of good manners and right conduct (GMRC), a basic subject in elementary and high school especially in public schools. But I overheard someone complaining that his speech spoiled their appetite for the lechon.

Councilor Gerry Guardo, chair of CCCDC, in his welcome address, apologized to the cooperatives for the delayed coop month culmination program, which should have been done at the end of October, due to some logistics issues. He also announced that Labella could not attend because he was called to Malacañang.

The more than 600 cooperators on Monday during the one-day National Cooperatives Summit were unanimous in opposing the move of the Bureau of Internal Revenue (BIR) to tax the cooperatives. Under RA 9520, cooperatives are exempt from income tax. The BIR, however, is under instruction from the Department of Finance (DoF) to start examining the books of all coops.

The 600 cooperators representing different cooperatives from the different cities and provinces have complained that despite the tax exemption that’s provided by law, RA 9520, the BIR has started issuing assessment in millions of pesos while the smaller cooperatives were given a runaround in securing the certificate of exemption (CTE).

Usec. Orlando Ravaner, chairman of the Cooperative Development (CDA), promised the cooperatives that he would resign if the BIR insists on collecting taxes. Articles 60 and 61 of RA 9520 exempt cooperatives from paying taxes. One of the purposes of RA 9520 is “to generate funds and extend credit to the members for productive and provident purposes.”

The one-day National Coop Summit, which was spearheaded by CFI Coop, came up with a position and resolution to bring to the attention of Congress and President Duterte their displeasure over the move of the BIR to collect taxes when the law exempts cooperatives from taxation.

For his part, former congressman Pabling Garcia and co-author of the Coop law, said only Congress could amend the law that exempts cooperatives from taxation. The move of the BIR to collect tax on cooperatives is highly illegal, he said.