Articles of Cooperation Privileges of Cooperative from Taxes

a. May also contain any other provisions not 1. Duly registered cooperatives which do not transact
inconsistent with this Code or any related law. any business with nonmembers or the general public
b. Four (4) copies each of the proposed articles of shall not be subject to any taxes and fees imposed
cooperation, bylaws, and the general statement under the tax laws.
required under Article 11 of this Code shall be 2. Cooperatives transacting business with both
submitted to the Authority. members and nonmembers shall not be subject to tax
on their transactions with members. The transactions
of members with the cooperative shall not be subject
Bylaws - shall be filed at the same time as the articles of to any taxes and fees, including taxes on members’
cooperation deposits and documentary tax. Cooperatives dealing
with nonmembers shall enjoy the following tax
exemptions:
A. Cooperatives with accumulated reserves and
Membership in cooperative undivided net savings of not more than ten million
1. A regular member is one who has complied with all the pesos (P10,000,000.00) shall be exempt from all
membership requirements and entitled to all the national, city, provincial, municipal or barangay
rights and privileges of membership. taxes of whatever name and nature. Such
2. An associate member is one who has no right to vote cooperatives shall be exempt from customs
nor be voted upon and shall be entitled only to such duties, sales taxes on their importation of
rights and privileges as the bylaws may provide. machineries, equipment and spare parts used by
However, an associate who meets the minimum them and which are not available locally.
requirements of regular membership, continues to B. Cooperatives with accumulated reserves and
patronize the cooperative for two (2) years, and divided net savings of more than ten million pesos
signifies his/her intention to remain a member shall be (P10,000,000.00) shall pay the following taxes at
considered a regular member. the full rate:
 Income Tax on the amount allocated for
interest on capital. The same tax is not
consequently imposed on interest
 individually received by members. 5. Cooperatives shall enjoy the privilege of depositing
Cooperatives regardless of classification their sealed cash boxes or containers, documents or
are exempt from income tax from the any valuable papers in the safes of the municipal or
date of registration with CDA. city treasurers free of charge.
 Value-Added Tax on transactions with 6. Cooperatives organized among government
nonmembers. However, cooperatives employees shall enjoy the free use of any available
duly registered with CDA are exempt from space in their agency.
the payment of value-added tax 7. The preferential right to supply government
3. Donations to charitable, research and educational institutions and agencies rice, corn and other grains,
institutions and reinvestment to socioeconomic fish and other marine products, meat, eggs, milk,
projects within the area of operation of the vegetables, tobacco and other agricultural
cooperative may be tax deductible commodities produced by their members shall be
4. All cooperatives, regardless of the amount of granted to the cooperatives concerned.
accumulated reserves and undivided net savings shall 8. Preferential treatment in the allocation of fertilizers,
be exempt from payment of local taxes and taxes on including seeds shall be granted to cooperatives by
transactions with banks and insurance companies. the appropriate government agencies.
9. Cooperatives, such as farm and fishery producers and
Other Privileges of a Cooperative suppliers, market vendors which have for their primary
1. The judge, exercising his ex o icio capacity as notary purpose the production and marketing of products
public shall render service, free of charge from agriculture, fisheries and small entrepreneurial
2. Any register of deeds shall accept for registration, free industries shall have preferential rights in the
of charge, any instrument relative to a loan which does management of public markets and lease of public
not exceed Two Hundred Fifty Thousand Pesos market facilities, stalls or spaces.
(P250,000.00). 10. Cooperatives engaged in credit services shall be
3. Cooperatives shall be exempt from the payment of all entitled to loan credit lines with the DBP, the Land
court and sheri ’s fees. Bank and other financial institutions except the BSP.
4. All cooperatives shall be exempt from putting up a 11. The Philippine Deposit Insurance Corporation (PDIC)
bond for bringing an appeal against the decision of an and other government agencies shall provide
inferior court or for seeking to set aside any third-party technical assistance to register national federations
claim. and unions of cooperatives.
12. A public transport service cooperative may be entitled
to financing support for the acquisition and
maintenance of land and sea transport equipment,
facilities and parts.
13. Cooperatives transacting business with the
Government of the Philippines shall be exempt from
prequalification bidding requirements.
14. Cooperatives shall enjoy the privilege of being
represented by the provincial or city fiscal or the O ice
of the Solicitor General, free of charge.
15. Cooperatives organized by faculty members and
employees of educational institutions shall have the
preferential right in the management of the canteen
and other services