Previously discussed were two important laws affecting cooperatives and small and medium enterprises including cooperatives Republic Act Number 9510 also known as Credit Information System Act (CISA) and Republic Act Number 10708 also known as Tax Incentives Management and Transparency Act (TIMTA) must be carefully considered by cooperatives and all stakeholders. The significance of these laws in the operation of cooperatives and SMEs is worth studying as the sanctions are heavy when imposed.
The challenge under TIMTA is that all registered business entities including cooperatives must be enrolled in the electronic filing payment system (efps) of BIR at the same time comply with regulatory requirements. Since most of the cooperatives are classified as micro and even some small, and medium still practice manual transactions, there is a need for these cooperatives to embrace technological advancement in their operations. Likewise, the CISA also requires computerized operations especially on data generation on membership records and transactions.
Further, in the course of TIMTA implementation starting from the crafting of the implementing rules and regulations, several agencies are involved like the Department of Finance, Department of Trade and Industry. Also, the Bureau of Internal Revenue and Bureau of Customs have functions to perform.
SECTION 5. Monitoring of Tax Incentives. The BIR and the BOC shall submit to the Department of Finance (DOF), notwithstanding any law to the contrary: (a) the tax and duty incentives of registered business entities as reflected in their filed tax returns and import entries; and (b) actual tax and duty incentives as evaluated and determined by the BIR and the BOC. For purposes of monitoring and transparency, the DOF shall submit to the Department of Budget and Management (DBM) the aggregate data on a sectoral and per industry basis of: (1) the amount of tax incentives availed by registered business entities; (2) the estimate claims of tax incentives immediately preceding the current year; (3) the programmed tax incentives for the current year; and (4) the projected tax incentives for the following year. Such information shall be given to the Oversight Committee created under SECTION 9 of this Act.
Considering these challenges, we encourage all cooperatives and stakeholders to work harmoniously to help realize the intention of the laws discussed. MERRY CHRISTMAS and a Happy New Year.
