vat exemption of Cooperatives

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vat exemption of Cooperatives

Post by kim on Mon Jan 11, 2010 12:49 pm

among the 4 bidders is a cooperative. It is a contract bidding for janitorial services. all other items' bid prices, all bidders are more or less very competitive, especially that services bid are subject to DOLE statutory laws on wages - EXCEPT for VAT! other bidders offers are inclusive of VAT, but the cooperative bid is without VAT coz coops are not subject to VAT. My question is for levelling purposes (equal positioning of bidders), do we add VAT to the coop bid price? Question Question
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Re: vat exemption of Cooperatives

Post by sunriser431 on Mon Jan 11, 2010 1:34 pm

kim wrote:among the 4 bidders is a cooperative. It is a contract bidding for janitorial services. all other items' bid prices, all bidders are more or less very competitive, especially that services bid are subject to DOLE statutory laws on wages - EXCEPT for VAT! other bidders offers are inclusive of VAT, but the cooperative bid is without VAT coz coops are not subject to VAT. My question is for levelling purposes (equal positioning of bidders), do we add VAT to the coop bid price? Question Question

Welcome to the forum Kim. Try this link it might help http://www.gppb.gov.ph/opinions/view_opinion.asp?o_id=583
except of section 32.2.2
32.2.2. The BAC shall evaluate all bids on an equal footing to ensure fair and competitive bid comparison. For this purpose, all bidders shall be required to include the cost of all taxes, such as, but not limited to, value added tax (VAT), income tax, local taxes, and other fiscal levies and duties which shall be itemized in the bid form and reflected in the detailed estimates. Such bids, including said taxes, shall be the basis for bid evaluation and comparison.
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Re: vat exemption of Cooperatives

Post by Guest on Mon Jan 11, 2010 1:44 pm

kim wrote:among the 4 bidders is a cooperative. It is a contract bidding for janitorial services. all other items' bid prices, all bidders are more or less very competitive, especially that services bid are subject to DOLE statutory laws on wages - EXCEPT for VAT! other bidders offers are inclusive of VAT, but the cooperative bid is without VAT coz coops are not subject to VAT. My question is for levelling purposes (equal positioning of bidders), do we add VAT to the coop bid price? Question Question

in case of coop you must add the vat in computation of their bid however in case they pass all the qualification and won the vat inclusive in the computation will be deducted in the payment.
That is only my opinion however in the recent opinion of the gppb coop is required to pay the VAT.

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Re: vat exemption of Cooperatives

Post by Niwram on Tue Jan 12, 2010 9:00 am

http://www.gppb.gov.ph/opinions/view_opinion.asp?o_id=228
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cooperative vs non cooperative

Post by allan452007 on Sat Apr 07, 2012 7:47 pm

We have participated in a bidding of a water district project. The BAC issued a format of detailed estimate enumerating a 7% taxes to be incorporated in each bid item. There are tax excempt cooperative and non cooperatives that was participated in the said bidding. The LCB is a cooperative and the contract was awarded to it by deducting the 7% previously incorporated in the bid computations.

Considering that the actual VAT being remitted by non cooperative is 12% of its sales, less tax input, and is paying the income tax for the net income derived from its operation while the tax exempt cooperative is none, would you say the BAC excercise the essence of equal footing?

Please give us your utmost comments, thank you

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Re: vat exemption of Cooperatives

Post by engrjhez® on Tue Apr 10, 2012 9:45 am

allan452007 wrote:We have participated in a bidding of a water district project. The BAC issued a format of detailed estimate enumerating a 7% taxes to be incorporated in each bid item. There are tax excempt cooperative and non cooperatives that was participated in the said bidding. The LCB is a cooperative and the contract was awarded to it by deducting the 7% previously incorporated in the bid computations.

Considering that the actual VAT being remitted by non cooperative is 12% of its sales, less tax input, and is paying the income tax for the net income derived from its operation while the tax exempt cooperative is none, would you say the BAC excercise the essence of equal footing?

Please give us your utmost comments, thank you

The BAC cannot dictate the inputs for every entry. It is up to the bidder to follow the prescribed format in presenting their bids (from base price up to taxes). It shall only serve a guide for the BAC to establish the 'equal footing' later.

I think the 7% thing is the 'immediate' tax being withheld by the PE (particularly LGU) for the transaction. The remaining 5% will be for the national government. The P will issue later certificate of 'tax withheld' for annual filing purposes of supplies/contractors. Smile
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