BIR Ruling

July 11, 1977 Dr. Eduardo H. Jamora Chairman, Organization Committee Fifth Asia Pacific Congress on Diseases of the Chest 1311 Batangas St., Makati Metro Manila S i r : This refers to your letter dated May 19, 1977, requesting "assistance in getting tax exemption" for the donations to the Organizing Committee, Fifth Asia Pacific Congress on Diseases of the Chest. It appears that the Asia-Pacific Congress on Diseases of the Chest will be held in Manila on November 6 to 10, 1977; that the Philippines was chosen as the site of this international gathering thru the efforts of the International Academy of Chest Physicians and Surgeons, Philippine Chapter; and that industries sympathetic and aware of the importance of the international meeting have offered help and assistance, in kind and cash, to help defray the expenses of the Committee. It further appears that the purpose of the meeting is to exchange scientific knowledge in the treatment of chest diseases. In reply, you are advised that the applicable law is Presidential Decree No. 507, implemented by Revenue Regulations No. 8-74, dated September 24, 1974, copies of which are enclosed. It will be noted that the aforementioned law exempts from the donor's gift tax donations to non-profit social welfare, cultural and charitable institutions, no part of the net income of which inures to the benefit of any individual. It appears, however, that your committee is a mere organizing committee for the Fifth Asia Pacific Congress on Diseases of the Chest, and for the purpose of hosting the aforesaid "congress" which will be held in Manila. In other words, it is not an institution organized for social welfare, charitable or cultural purposes. It is a mere committee organized for one single purpose "to prepare for the hosting" of the aforementioned congress. Moreover, admittedly, the donations will be used in "the preparations for the hosting" of said congress. Under such circumstances, it cannot be considered a qualified donee within the purview of Presidential Decree No. 507, and consequently, every donation to your committee which exceeds P1,000.00 shall be subject to the donor's gift tax payable by each donor. However, where a donation does not exceed P1,000.00, and the donor has not made any donation within the year, which, if added to the donation to your committee, will not amount to more than P1,000.00, the donor shall be exempt from the donor's gift tax, pursuant to Section 109 of the Tax Code, as amended by Presidential Decree No. 69. Said donor, however, will not be entitled to deduct from his gross income the amount or value of his donation to your committee. In this connection, you are advised that if the International Academy of Chest Physicians and Surgeons, Philippine Chapter, proves that it is duly organized as a charitable or social welfare institution, donations to said organization, and not to a mere committee of said organization, shall be exempt donations within the purview of P.D. No. 507 subject to the limitation provided for in Section 6 of Revenue Regulations No. 8-74. However, a certificate of qualification for exemption under P.D. No. 507 shall be issued only upon compliance with the requirements of said regulations. (see attached copy of Revenue Regulations No. 8-74). Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-P4519-F2828-A-8