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EXECUTIVE ORDERS
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EXECUTIVE ORDER NO. 277 - DIRECTING
THE MODE OF TREATMENT UTILIZATION, ADMINISTRATION AND MANAGEMENT OF THE
COCONUT LEVY FUNDS
WHEREAS, the coconut levy funds,
which comprise four general classes, viz.: (a) the Coconut Investment
Fund created under R.A. 6260 (effective June 19, 1971); (b) the Coconut
Consumers Stabilization Fund under P.D. 276 (effective August 29,
1973); (c) the Coconut Industry Development Fund under P.D. 582
(effective November 14, 1974); and (d) the Coconut Industry
Stabilization Fund under P.D. 1841 (effective October 2, 1981), were
created to support and advance the development of the coconut industry
for the ultimate benefit of the coconut farmers;
WHEREAS, the Supreme Court, in upholding the sequestration of various
industrial and commercial enterprises organized and financed with
proceeds from the coconut levy, declared in the Philippines Coconut
Producers Federation, Inc. (COCOFED), et al. vs. Presidential
Commission on Good Government (PCGG), et al. (178 SCRA 236 21 October
1989) case that:
“The
utilization and proper management of the coconut levy funds, raised as
they were by the State’s police and taxing powers, are certainly the
concern of the Government. it cannot be denied that it was the welfare
of the entire nation that provided the prime moving factor for the
imposition of the levy. it cannot be denied that the coconut Industry
is one of the mayor industries supporting the national economy.t is,
therefore, the State’s concern to make it a strong and secure source
not only of the livelihood of a significant segment of the population
but also of export earnings the sustained growth of which is one of the
imperatives of economic stability. The coconut levy funds are clearly
affected with public interest. Until it is demonstrated satisfactory
that they have legitimately become private funds, they must prima facie
and by reason of the circumstances in which they were raised and
accumulated be accounted subject to the measures prescribed in E.O.
Nos. 1, 2, and 14 to prevent their concealment, dissipation, etc. which
measures include the sequestration and other orders of the PCGG
complained of .”
WHEREAS, the Supreme Court, in ruling that the PCGG is entitled to vote the sequestered shares of stock of the United Coconut Planters Bank (Republic vs. Sandiganbayan, G.R. No. 96073, 16 February 1993), reiterated the above declaration and clarified that:
“The
coconut levy funds being ‘clearly affected with public interest,’ if
follows that the corporations formed and organized from those funds,
and all assets acquired as ‘clearly affected with public interest.’“
WHEREAS, THE constitution mandates that:
“Sec.
2.
xxx
Sec. 3.
WHEREAS. the commission on Audit, consistent with its mandate and relying upon the above declaration of the supreme court, has opined on 15 January 1993 that the coconut levy:
.. would seem to fall within the purview of the provisions of Sec. 63 of Presidential Decree No. 1445, to wit:
‘Except as may otherwise be
specifically provided by law or competent authority all moneys and
property officially received by a public officer in any capacity or
upon any occasion must be accounted for as government funds and
government property.
It would seem, therefore, that
all moneys realized form the said levy should accordingly be accounted
for as governments funds the provisions of section 5, Article III, of
PD No. 961 notwithstanding, in the light of the following provisions of
the 1987 constitution:
‘All money collected on any tax
levied for a special purpose shall be treated as a special fund and aid
out for such purpose only. If the purpose for which a special fund was
created has been fulfilled or abandoned, the balance, if any, shall be
transferred to be genera; fund of the Government. (Sec. 23 3, Article
VI).
‘All existing laws, decrees,
executive orders, proclamations, letter of instructions, and other
executive issuances not inconsistent with this Constitution shall
remain operative until amended, repealed, or revoked funds.
xxx
In the light of the foregoing,
this Commission is strongly of the view that the coconut levy is a
public fund, and therefore subject to government audit.”
WHEREAS, the Bureau of Internal revenue, in replying to the query raised by the Philippine Coconut authority Administrator as to the character of the coconut levy funds, relied upon the same Supreme Court ruling and, thus, ruled on 15 December 1992, as follows:
“. . the Supreme Court of the Philippines, already had the occasion to
make an En Banc pronouncement that it was the welfare of the entire
nation that provided the prime moving factor for the imposition of the
levy. Neither can it be denied that the coconut industry is one of the
major industries supporting the national economy. . .
Moreover, the coconut levies are
forced contributions levied by the taxing power on the coconut farmers.
the levies imposed upon the coconut products of their coconut farmers
are taxes in fact. They are enforced contributions levied by the taxing
power on the coconut farmers, neither defendant upon the will nor the
contractual assent, express or implied of the persons thus taxed. Thus,
the coconut farmers were originally required by R.A. 6260, on June 19,
1971, to pay the sum equivalent of P0.55 on their first domestic sale
of every one hundred kilograms of copra, or its equivalent in
terms of other coconut products; P0.50 of the exaction were
accrued to a special fund, the COCONUT INVESTMENT FUND(CIF). Likewise,
the levy of P15.00 per 100 kilograms of copra resecada or its
equivalent in other coconut products, set by P.D. 276 on August 20,
1972 were imposed on the farmer’s first domestic sale and they were
accrued to a separate trust fund known as the COCONUT CONSUMERS
STABILIZATION FUND (CCSF).
Such being the case, and since
the burdens of the levies thereby imposed and collected were meant to
be shouldered by the coconut farmers, the coconut levy is not a public
trust fund for the benefit of the coconut farmers, but it is in the
nature of a tax and, therefore, are public funds that are subject to
government administration and disposition.”
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines pursuant to the powers vested in me by lay hereby order and direct:
(a)
The heads of the Department of
Agriculture, Presidential Commission on Good Government Philippine
Coconut Authority, united Coconut Planter’s Bank and The Coconut
Industry Investment Fund, herein constituted as an ad-hoc committee
with the secretary of Agriculture as Chairman, in consultation with
representative of the coconut industry, including coconut farmer’s
organizations, shall jointly review, rationalize and integrate their
concerns and programs in a Master Plan for the years 1995 to 2000.
(b)
DONE in the City of Manila, this 24th day of September, in the year of Our Lord, nineteen hundred and ninety-five.
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Since 19.07.98.