coco levy fund

Senate approves new coco levy bill on 2nd reading

JC Gotinga
Coconut farmers have been waiting for decades to benefit from billions of pesos in taxes that were, in President Rodrigo Duterte's words, 'taken from their pockets arbitrarily'

The Senate on Monday, September 28, approved on 2nd reading a new bill on the management and disposition of the controversial coco levy fund – bringing the proposed measure a step away from final approval by the chamber.

Senate Bill (SB) No. 1396 creates a trust fund for coconut farmers and the coconut industry, and it reconstitutes the Philippine Coconut Authority (PCA) Board for this purpose.

The trust fund will come from the coco levy fund – the tax imposed on coconut farmers by the dictator Ferdinand Marcos from 1971 to 1983. Marcos and his cronies invested the money in businesses, but “rewards” and benefits promised to the farmers never materialized.

Amounting to P9.7 billion at the time, the coco levy fund is now worth around P76 billion.

SB No. 1396 was principally authored and sponsored by Senator Cynthia Villar. Other authors were senators Francis Pangilinan, Ralph Recto, and Imee Marcos, daughter of the late dictator.

In early 2019, Congress passed and ratified two bills: one creating the trust fund for coconut farmers and the industry, and another reconstituting the PCA Board.

But President Rodrigo Duterte vetoed the bills, despite his campaign promise to restore the coco levy funds to coconut farmers.

At the time, Malacañang disagreed with the proposed inclusion of 6 private farmers and an industry representative in the 15-member PCA Board, arguing that the trust fund, as public monies, should be managed by government officials. The palace also found the PCA Board’s authority under the bill too broad.

Lawmakers then went back to the drawing board. This new Senate version unites the two vetoed measures into a single bill.

Duterte’s rejection of the earlier coco levy bills disappointed coconut farmers who had counted on his promise, and who have been waiting for decades to benefit from the money taken from them.

During his State of the Nation Address (SONA) in July 2019, Duterte acknowledged that the coco levy money “was taken out of the pockets of Filipinos arbitrarily.” He then pushed for the passage of a new coco levy bill.

Duterte again mentioned the coco levy fund during his latest SONA last July.

In drafting this new bill, Villar was mindful of the provisions that had prompted the President’s veto. The proposed measure will be up for 3rd and final reading by the Senate after at least 3 days from its approval on 2nd reading. –

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JC Gotinga

JC Gotinga often reports about the West Philippine Sea, the communist insurgency, and terrorism as he covers national defense and security for Rappler. He enjoys telling stories about his hometown, Pasig City. JC has worked with Al Jazeera, CNN Philippines, News5, and CBN Asia.