Farmers, fisherfolks exempted from income tax – BIR

November 14, 2021 Provincial

The Bureau of Internal Revenue (BIR) recently released a revenue regulation exempting farmers and fisherfolks from paying income taxes provided they are registered as barangay microbusinesses.
This BIR Revenue Regulation No. 19-2021 implements the tax incentive and exemption provisions of Republic Act (RA) No. 11321 otherwise known as “An Act Instituting the Farmers and Fisherfolk Enterprise Development Program of the Department of Agriculture also known as “Sagip Saka Act.”
Under Section 3 of said regulation :”all accredited farmers and fisherfolk enterprises may be exempted from income tax directly arising from their operations of their enterprises provided they are registered as Barangay Micro-Business Enterprise (BMBE).”
The BIR said ,the exemption from income tax shall apply only if, and during the period which, the accredited farmers and fisherfolk enterprise are registered as BMBE issued with Certificate of Authority by the agriculture department, through the Negosyso Center in the city or municipality where business is located.
The revenue regulation covers accredited farmers and fisherfolk enterprise engage in agriculture and fishery-related economic activities, including, among others producer groups, fisherfolk organizations and cooperatives, and clusters of growers and fishers.
These enterprises have products that are in the priority commodity value chains and can increase their marketable surplus, and either operational and/or willing to undergo capacity building or enterprise development, the BIR further said.
To avail of the income tax exemption, the cooperative or enterprise must be registered as a barangay micro-business enterprise and have total assets that do not exceed P3 million, including assets from loans but excluding the land on which the office or plant is based.
Donations of real and personal properties to such farmers and fisherfolk enterprises are also exempt from donor’s taxes.
The donation must be consistent with the objectives to develop enterprises for farmers and fisherfolks towards in achieving “sustainable modern agriculture and food security.”
Primo Agatep/ABN