Summary
RR No. 7-2015 further amends Section 2.57.2 of RR No. 2-98, particularly Subsection (AA) introduced by RR No. 11-2014, on income payments on locally produced raw sugar.
Key points
- One percent withholding. Subsection (AA) covers gross payments on purchases of sugar at one percent (1%). Sugar mill or refinery proprietors on their mill share, and buyers of Quedans or Molasses Storage Certificates, withhold the creditable income tax on locally produced raw cane sugar, raw sugar and molasses and remit it to the BIR.
- Base prices. For locally produced raw cane sugar and raw sugar, the base price is P1,000.00 per fifty (50) kg bag or the actual selling price, whichever is higher. For molasses, it is P4,000.00 per metric ton or the actual selling price, whichever is higher. The Commissioner may adjust these depending on the prevailing market price.
- Refined sugar and definition. Buyers of refined sugar, whether locally produced or imported, withhold based on the actual selling price. Sugar means raw cane sugar, raw sugar and refined sugar.
- Authority to Release. The Regional Director or Revenue District Officer with jurisdiction over the mill or refinery issues the Authority to Release for locally produced raw sugar, raw cane sugar, molasses or locally refined sugar. Copies of proof of payment of the creditable withholding tax (BIR Form No. 1601-E and BIR Form No. 2524) must be attached to the written request.
- Small sugar owners. Sugar owners who plant their own sugar and have gross receipts for a year not exceeding P300,000.00 follow the simplified rules of registration and bookkeeping. They must still file their Income Tax Return on the date required under the NIRC.
Who is affected
- Sugar mill and refinery proprietors or operators
- Buyers of Quedans or Molasses Storage Certificates
- Buyers of refined sugar
- Sugar owners with gross receipts not exceeding P300,000.00 a year
Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.
Copies of BIR issuances are hosted here for reference. For the official version, check bir.gov.ph. Summaries by Tax Resources PH are not a substitute for the full text or professional advice.