The Bureau of Internal Revenue has extended fiscal incentives to farmers and fisherfolk enterprises in line with provisions of Republic Act 11321 or the Sagip Saka Act that was signed into law in 2019. As such, farmers and fishermen registered as barangay micro business enterprises (BMBEs) will no longer pay income and donor’s taxes.
Revenue Regulations 19-2021 grants agricultural firms accredited as BBMEs exemption from paying taxes for income from operations. According to the BIR, the tax break applies only to farmers and fishermen entities issued with a certificate of authority to perform as BBME by the Department of Trade and Industry. Likewise, they should be listed as a beneficiary under RA 11321’s implementing rules and regulations.
Beneficiaries involve mostly producer groups whose products are listed as priority commodities with the prospect of gaining marketable surplus.
Aside from operating as BMBEs, farmers and fisherfolk enterprises may only avail of the tax perk if their assets, inclusive of loans, amount to less than P3 million.
The RR also provides donors with an exemption from paying donor’s tax on donations of real and personal properties that they pass on to agricultural firms certified by the Department of Agriculture to be included as a proponent of the Farmers and Fisherfolk Enterprise Development Program under the Sagip Saka Act.
The Sagip Saka Act supports the purchase of farm and fish products from local growers through various mechanisms, including the exemption of local government procurement from the bidding process and the provision of incentives to private firms participating in the program.
The RR spells good news for qualified farmers and fisherfolk who can take advantage of the benefits of the fiscal incentives being offered. Government has done the work to make it available. It is now time for the intended beneficiaries to do the work by organizing themselves and registering with the appropriate government agencies.*