BIR Ruling

March 14, 1974 Miss Leticia Gartos Ng Ramos Ext., Capitol Site Cebu City M a d a m : This refers to your letter dated January 10, 1973 requesting exemption from the payment of fixed and percentage taxes under the provisions of the NACIDA law. cdt Investigation disclosed that you are engaged in the business of making or manufacturing figurines; that you started operation on August 11, 1972 with a capitalization of P2,500.00; that you have five (5) employees who are not members of your family; that your factory facilities consists of an air compressor and air brass; and that your business is registered with the NACIDA as "CERAMICS" under Certificate of Registration No. 02635 dated October 17, 1972. In reply, I have the honor to inform you that under the foregoing circumstances, you are exempt from the payment of fixed and percentage taxes pursuant to the provisions of Republic Act No. 3470, as amended by Republic Act No. 5326. It may be stated that although you employees or workers are not members of your family, this fact alone does not operate to deprive your activity of the tax exemption benefits of the law so long as it is a cottage industry in the judgment of the NACIDA. (Opinion, Secretary of Justice dated November 15, 1967). Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue TAN-1601-593-5