BIR Ruling

March 12, 1970 Congressman Leopoldo D. Diaz House of Representatives Manila Attention: Mr . Renato V . Diaz Private Secretary S i r : This refers to your letter dated January 9, 1970 requesting information on the following: 1. Present rate of Miller's Tax; 2. Amount of collection for the year 1968-1969; 3. Disposition of the amount collected (is this a special fund for local government?) and 4. Any other data related to this Miller's Tax. In reply, I have the honor to inform you as follows: Owners or operators of rice or corn mills are subject to the annual graduated fixed tax based upon total capacity per machine for every twelve (12) hour operation in accordance with Section 182(A)(3)(mm) of the Tax Code, as amended by Republic Act No. 6110, otherwise known as the Omnibus Tax Law. Under Section 189 of the Tax Code, as amended by Republic Act No. 6110, operators of sugar centrals, coconut oil mills and cassava mills shall pay a tax equivalent to two per centum of the gross value in money of all the . . . sugar, . . . cassava flour or starch . . . milled by them, including the by-products of the raw materials from which said articles are produced, processed or manufactured, such tax to be based on the actual selling price or market value of these articles at the time they leave the factory or mill warehouse. The law further provides that in case the raw materials are processed, manufactured or milled in pursuance of a contract where the factory, central, or mill receives a share of the finished products, the tax on the share pertaining to the planter or owner of the raw materials shall be charged to the planter or owner and withheld by the proprietor or operator of the factory, central or mill and paid by him to the Commissioner of Internal Revenue. acd For the fiscal year 1968-69, the following amount of miller's tax was collected: For the fiscal year 1968-69, the following amount of miller's tax was collected: FISCAL YEAR 1968-1969 Owners or operators of Rope Factories P246,965.63 Owners or operators of Sugar Centrals 10,028,586.53 Owners or operators of Rice Mill 58,268.00 Owners or operators of Coconut Oil Mills 1,748,466.48 Owners or operators of Corn Mill 16,310.25 Owners or operators of Desiccated Coconut Factories 1,269,917.04 Owners or operators of Cassava Flour Mills 12,974.82 ____________ TOTAL P13,379,488.75 The tax collected from owners or proprietors of cassava flour or starch mills accrues to the National Treasury and shall be available for the general purposes of the Government. However, the 2% miller's tax levied on owners or proprietors of sugar centrals are disposed in accordance with Section 15 of Republic Act No. 632, as amended by Republic Act No. 3051 as follows: "SEC. 15. Capitalization . Fifty per centum of the proceeds of the percentage tax levied on proprietors or operators of sugar centrals under Section one hundred eighty-nine of Commonwealth Act Numbered Four hundred sixty-six, otherwise known as the National Internal Revenue Code, as amended, shall, upon approval of this Act, accrue to the Sugar Research and Stabilization Fund as provided in Section sixteen of this Act. The remaining fifty percentum of the said proceeds shall likewise accrue to the Sugar Research and Stabilization Fund unless the Philippine Sugar Institute, in its discretion, transfers and gives the same or part thereof as yearly aid to the Sugar Quota Administration to be used for the payment of salaries of additional personnel and the purchase of equipment, supplies and materials, for the purpose of accomplishing the efficient performance of the duties of the Sugar Quota Administration. Said percentage tax shall constitute a lien on the sugar quedans and/or warehouse receipts and shall be paid immediately to the Commissioner of the Bureau of Internal Revenue; Provided , however , That not more than fifty per centum of all proceeds shall be used for salaries of its officials and employee." cd Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue