January 5, 2015
The Philippine Star
By Zinnia B. dela Peña
MANILA, Philippines - The Bureau of Internal Revenue (BIR) will impose a one percent creditable withholding tax on income payments on locally produced raw sugar.
This after the BIR created a separate sub-section for the withholding of creditable income tax on locally produced raw sugar given the peculiarity of operations by the sugar firms under the watch of the Sugar Regulatory Administration (SRA).
Under the new rules, proprietors or operators of sugar mills/refineries and direct buyers of quedans or molasses storage certificates from the sugar planters on locally produced raw sugar and molasses shall withhold the creditable income tax and remit the same to the BIR based on the applicable base price of P1,000 per 50 kilogram bag and P4,000 per metric tons, respectively.
This, however, is subject to adjustment deemed necessary by the BIR commissioner upon consultation with the SRA administrator.
The regional director through the recommendation of the Revenue District Officer, who has jurisdiction over the physical location of the sugar mills and refineries shall issue the authorization allowing the release of locally produced raw sugar/molasses to the proprietors or operators for further processing into refined sugar, consumption or other purposes.
The authorization, however, will only be issued when copies of proofs of payment of the creditable withholding tax due thereon and bank payment/deposit slip/official receipt shall have been submitted and attached to the written request.
A one percent creditable withholding tax will also be imposed on income payments made to agricultural suppliers but not limited to payments made by hotels, resorts, caterers, food processors, canneries, supermarkets, livestock, poultry, fish and marine product processors, factories, furniture shops and all other establishments in excess of the cumulative amount of P300,000 within the same taxable year.
Agricultural products shall only include corn, coconut, copra, palay, rice, cassava, coffee, fruit, vegetable, marine food product, poultry and livestock, the BIR said.
Also covered by the new rule are income payments made by the top 20,000 private corporations to their local/resident supplier of goods and local/resident supplier of services other than those covered by other rates of withholding tax.
Reference link: http://www.philstar.com/business/2015/01/05/1409407/bir-impose-1-withhol...