BIR Ruling

July 17, 1970 Mr. Tomas S. Mulato Certified Public Accountant General Auditing Office U. P. Los Baos Unit College, Laguna S i r : This refers to your letter to the Commissioner, Civil Service Commission, dated December 12, 1969, stating the following: "I paid a privilege tax (C.P.A.. professional fee) under Official Receipt # 3889074E dated January 20, 1970 in the amount of Seventy Five (P75.00) Pesos only for the 1969 2nd Semester deficiency and 1st semester of 1970, at the municipality of Los Baos, Laguna. Would this amount to my right for a license to practice my profession in the Philippines? "In connection with this privilege tax which I have paid, can this amount be reimbursed as in the case of a legal counsel where their membership fee to the B.A.R. and other expenses in connection with their profession as lawyers be reimbursable? In reply, I have the honor to inform you that a privilege tax receipt is a mere evidence of payment of tax and cannot be considered as authority to exercise a profession (see People vs. Cinco (1922) R.G. No. 17875). While it is true that Section 182(B) of the Tax Code states that a professional who has paid the corresponding annual privilege tax shall be entitled to practice in all parts of the Philippines, said statement is qualified by the phrases "every professional legally authorized to practice his profession" and "for which he has been duly qualified under the law." In other words, it is clear that payment of the tax is but one of the prerequisites of the practice of a profession and evidence of payment thereof cannot serve as evidence of qualification required of the profession, nor as evidence of authority of a government employee to engage in private practice of his profession. aisadc The amount you paid as privilege tax cannot be refunded, since as certified public accountant, you are subject to the occupation tax, in which case, the collection of the tax was neither illegal nor erroneous. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue