BIR Ruling

July 29, 1969 Mr. Vicente B. Fernandez President & General Manager National Printing Co., Inc. 71 Quezon Blvd., Ext. Quezon City S i r : This refers to your letter dated July 19, 1969 requesting that the importation of graphic arts films by Keyser Mercantile, Co., Inc. for your exclusive use under special arrangements be subjected only to the compensating tax and not the advance sales tax. It appears in the arrangement entered into by and between your firm and the Keyser Mercantile, Co., Inc. that Keyser will finance your importations of Graphic Arts Films under your name; that Keyser shall open the necessary Letter of Credit through their bank and all expenses will be for their account; that customs duties and sales tax as well as brokerage, cartage to their warehouse, etc. will be paid by Keyser; that Keyser will be designated as property custodian of the imported articles; that a certain price will be paid by you on every withdrawal of the imported articles from Keyser's warehouse; and that your failure to withdraw the entire shipment after 180 days from Keyser's receipt of the shipment, the latter will dispose the shipment to cover their investments. In reply, I have the honor to inform you that under the foregoing circumstances Keyser Mercantile, Co., Inc. is the importer in fact and in deed. Such being the case, importations of graphic arts films to be used in offset and photo-engraving processes under the foregoing arrangement are subject to the 7% advance sales tax based on the landed cost thereof plus 25% mark-up pursuant to Section 183(b) in relation to Section 186, both of the Tax Code. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue