February 1, 2016
Alden M. Monzon (Business World) | http://goo.gl/bTetRm
A MEASURE exempting raw cane sugar from the value-added tax (VAT) has been approved at bicameral level, with lawmakers confident it will be signed into law before the end of the Aquino administration.
On Monday, the legislature’s bicameral conference committee harmonized Senate Bill No. 2987 and House Bill No. 5713, with the unified bill listing out a single definition for “raw cane sugar.”
Senator Sergio R. Osmeña III and Negros Occidental Rep. Jeffrey P. Ferrer (1st district), authors of the measure in their respective chambers, said after the bicameral conference meeting that the committee report will be scheduled for ratification on the floor this week.
“It will get ratified tomorrow (Tuesday). It’s a very simple bill,” Mr. Osmeña said in a chance interview.
“We want to have it ratified this week at the House [of Representatives] instead of on May. But for sure, we’ll get it done under this administration,” Mr. Ferrer, for his part said.
The legislators decided on a raw cane sugar definition of a polarimeter reading of less than 99.5 for sucrose content in dry state.
Under Section 109 (1)(A) of the amended Internal Revenue Code of 1997, raw cane sugar and molasses are considered to be in their original state and exempted from 12% VAT.
If enacted, the measure will override Revenue Regulation No. 8-2015 of the Bureau of Internal Revenue which stipulated a sugar product to be considered “raw cane sugar” must have undergone one stage of filtration and centrifugal process.
In previous Congressional hearings, BIR officials estimated a foregone revenue of P1.4 billion if the measure is passed into law. Data from the Philippine Sugar Miller’s Association, Inc. show that sales of unrefined sugar account for about 30% of the total market for sugar in the Philippines. -- Alden M. Monzon