BIR Ruling

May 22, 1972 Mr. & Mrs. Ricardo Trofeo 20 Hillside Drive, Blue Ridge Quezon City S i r : This refers to your letter requesting information on the kind and extent of taxes you are obliged to pay by producing documentary films. It is represented that you have yourselves hired for periodic employment by any company, firm, society or person to film documentaries for their internal business needs, specifically training films, visual aids, progress reports, orientation and organizational operations and for these you are paid primarily according to the number of days spent in the making of the films called for or specified. You would also want to know whether the colored films (which are educational in nature and purpose) sent to Japan for quality processing and sent back to you are subject to the specific tax. Finally, you would like to be informed whether you would be subject to the contractor's tax if a government agency engages you to film a documentary. In reply, I have the honor to inform you that for engaging in the aforementioned business activities, you are an independent contractor within the purview of Section 191 (18) of the Tax Code subject to the annual fixed tax of P50.00 and to the 3% tax on your gross receipts. The colored films sent to Japan for quality processing, being educational in nature, are not subject to the specific tax pursuant to Section 146 of the same Code. Finally, you would be subject to the 3% contractor's tax if a government agency engages you to film documentary. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue