Section 20Sec./Art. 20

Taxation of Microfinance NGOs. A duly registered and accredited Microfinance NGO shall pay a two percent (2%) tax based on its gross receipts from microfinance operations in lieu of all national taxes: Provided, That preferential tax treatment shall be accorded only to NGOs whose primary purpose is microfinance and only on their microfinance operations catering to the poor and low-income individuals in alignment with the main goal of this Act to alleviate poverty. The non-microfinance activities of Microfinance NGOs shall be subject to all applicable regular taxes.

Duly registered and accredited Microfinance NGOs, as well as their clients, shall be required to have a Taxpayer Identification Number (TIN): Provided, That this shall be accomplished within a reasonable time as prescribed, by the Council: Provided, further, That the relevant government agencies, in coordination with the Council, shall provide simplified forms and procedures for securing the TIN.