BIR Ruling

January 3, 1973 Mr. Jesus L. Atienza Philippine Tobacco Board 7th Floor, DBF Bldg., David St. Manila S i r : This refers to your letter dated November 16, 1972 requesting information on the following queries: "1) Does Presidential Decree Number 30, include individuals who should file their income tax quarterly? What are the guidelines concerning this matter?" "2) By "export-oriented industries", are closed corporations included? Can these corporations be owned by individuals, and can these corporations be opened or established by anyone? "3) Regarding "commercial banks" does this include any bank existing at the moment? "4) Regarding livestock and other agricultural development projects, is it possible to invest money for planting sugar cane or anything connected with farming in any of the transactions involved, and are those transactions exempted from the payment of capital gains tax?" In reply, thereto, I have the honor to inform you as follows: As regards the first question, only those corporations subject to income tax under Section 24, Title II of the National Internal Revenue Code, are required to file quarterly income tax returns in accordance with the provisions of Revenue Regulations No. 12-72 dated December 1, 1972. Accordingly, individuals are not required to file quarterly income tax declarations. On the second question, Section 4(A) (4) Revenue Regulations No. 7A-72 dated November 16, 1972, amending Revenue Regulations No. 7-72 does not make any distinction as to the nature of the corporations engaging in "export oriented industries". It is sufficient that said corporations are duly organized in accordance with law, wherein the proceeds of the transaction involving their capital assets must be invested as capital, additional capital contribution or in new issues of capital stocks. On the third question, regarding Section 4(A) (5) of Revenue Regulations No. 7A-72, the term "commercial banks" includes all commercial banks already existing. And finally, on the last question, Section 4(A) (8) of Revenue Regulations No. 7A-72, includes in its purview investments in sugar cane plantings or anything connected with farming or other agricultural development projects. The investments as contemplated above should be made in accordance with the requirements of Revenue Regulations No. 7-72 and 7A-72 in order that the gains derived from the sale, disposition or transfer of capital assets will be exempt from capital gains tax. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue