BIR Ruling

March 3, 1976 Philippine Port Authority PNR Bldg., South Harbor Port Area, Manila Attention: Mariano F . Nicanor Acting General Manager Gentlemen : This refers to your letter dated January 29, 1976 requesting information on the tax liability of your office, which has been created as a government corporation under Presidential Decree No. 505, as amended by Presidential Decree No. 857, having as its main function the regulation and operations of national and private ports throughout the country. On the basis of the foregoing facts, you now pose the following queries: "1. What types of taxes are the Philippine Ports Authority (PPA) Head Office and its Port Management Units (PMU) required to pay? "2. What is the basis or bases of calculating such taxes? "3. What are the deadlines and frequencies of payment of such taxes? "4. What forms or documents is the PPA required to accomplish and file accordingly?" cdt In reply thereto, I have the honor to inform you as follows: 1. A close study of the pertinent provisions of Presidential Decree No. 857 regarding the activities and objectives of the Philippine Ports Authority, its powers and duties, shows that it is a government corporation exercising proprietory functions. As such it is subject to the payment of the P50.00 annual fixed tax and the 3% contractor's tax provided for by Sections 182(A)(1) and 191 of the Tax Code. With regard to your Port Management Units which are set up in strategic port zones in the country to handle port operations and maintenance as well as to collect port revenues, they are also subject to the aforesaid taxes. 2. The P50.00 annual fixed tax is fixed by law; while contractor's tax is based on the gross receipts to be derived by that authority. 3. The P50.00 annual fixed tax is payable annually, the same to be paid on or before January 31 of each year. The contractor's tax is payable quarterly on or before the 20th day of the month following the quarter. 4. As a corporation subject to internal revenue taxes, that Authority should provide itself with the necessary books of accounts such as journal, ledger, invoices and receipts and other accounting records which are required to be registered with this Office prior to the use thereof. cdtech Moreover, that Authority is subject to income and residence taxes. Very truly yours, CONRADO P. DIAZ Acting Commissioner of Internal Revenue TAN-1182-568-4