BIR Ruling

July 14, 1969 Mr. Edward A. Bellis c/o J. P. Heilbronn Co. P. O. Box 23, Makati, Rizal S i r : This refers to your letter dated March 14, 1968 requesting cancellation of the tax assessment issued against you in the amount of P3,504.34 as deficiency tax inclusive of interest and penalties for the year 1962. LexLib It appears that the assessment issued against you arose from the disallowance of the deduction claimed by you for various taxes allegedly paid to the U.S. Government in 1962 in the aggregate amount of P5,487.47 broken down as follows: 1962 Town and county tax Village of Lake Success, N.Y. P1,028.95 1962 Real Property tax Village of Lake Success, N.Y. P906.30 1962 School tax Nassau county, N.Y. (Second half, 1961-62) 1,122.83 1962 School tax Nassau county, N.Y. (1962-63) 2,429.39 T O T A L P5,487.47 In reply thereto, I have the honor to inform you that the taxes mentioned in Section 30 of the Tax Code refer only to those paid directly to the Government of the Philippines or to any political subdivision thereof. The pertinent provisions of Section 80 of Revenue Regulations No. 2, otherwise known as the Income Tax Regulations, are quoted hereunder for ready reference: ". . . . Import duties paid to the proper customs officers, and business, occupation, license, privilege, excise and stamp taxes and any other taxes of every name or nature paid directly to the Government of the Philippines or to any political subdivision thereof, are deductible. . . ." cdll Consequently, the aforementioned taxes which you had paid directly to the United States Government are not deductible for income tax purposes even though said taxes do not fall under any of the exceptions specifically provided for by Section 30 of the Tax Code. In view of the foregoing, your request for cancellation of the assessment issued against you, has to be, as it is hereby denied. You are therefore requested to pay to this Office or to the Collection agent, Office of the Regional Director, Revenue Region No. 6, Quezon City, the amount of P3,504.34 as deficiency income tax inclusive of the statutory penalties for the year 1962, within thirty (30) days from receipt hereof. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue