Registered Cooperatives Must be Free From Taxes, Charges, DILG Says

The Department of Interior and Local Government (DILG) reminded local executives to comply with the provisions of the law exempting duly registered cooperatives from paying applicable taxes, fees, and charges.

DILG Secretary Ismael ‘Mike’ D. Sueno said that the Department has not been complacent in reminding local government units (LGUs) to strictly abide by the laws regarding the exemption of registered cooperatives from various financial duties.

In his directive, Sueno said LGUs should strictly follow the provisions of the law to continuously foster the growth of cooperatives and empower them as contributing agents for economic advancement.

“Cooperatives promote self-reliance among our citizens. Hence, the government should encourage the growth of the cooperative movement by exempting them from taxes, fees, and charges,” he said.

The DILG Secretary said that the 1987 Constitution, Republic Act (RA) No. 9520 known as the Philippine Cooperative Code of 2008 and RA No. 7160 or the Local Government Codes in one breath specify the various exemptions to be granted to cooperatives which are able to settle all requisites and are duly registered.

“There are provisions in the law that promote the growth and welfare of registered cooperatives that LGUs have to strictly adhere to such as exemption from real property taxes as well as national, city, provincial, municipal or barangay taxes if it is within P10-M undivided net savings,” he said.

However, Sueno also stated that cooperatives must fulfill certain obligations to be able to qualify for these exemptions.

According to the Department of Finance, cooperatives must obtain a Mayor’s permit and pay the commensurate cost of the regulation, inspection, and surveillance of the operation of its business; secure a Community Tax Certificate; and pay service charges or rentals for the use of property and equipment or public utilities owned by the local government. (DILG)