BIR Ruling

December 22, 1972 Mr. Leo H. Larkin The Center for Educational Television Inc. Ateneo de Manila University Campus Loyola Heights, Quezon City S i r : This refers to your letter dated August 2, 1972 requesting a ruling as to whether or not that Foundation is subject to the payment of the 3% contractor' tax in connection with its contract with the Presidential Arm on Community Development for the preparation of educational materials under certain conditions and specifications as detailed in your letter of inquiry. cdt In reply, I have the honor to inform you that since that Foundation undertakes or agrees to do a specific job or work for the Presidential Arm on Community Development, that is to produce four (4) color training films and follow up visual materials, said Foundation is considered an independent contractor as contemplated under Section 191(18) of the Tax Code, as amended. As such, that Foundation is subject to P50.00 annual fixed tax under Section 182(A)(2) of the Tax Code and to the 3% contractor's tax on its gross receipts pursuant to Section 191 of the same Code. Although that Foundation has been determined by the National Science Development Board to have been organized for scientific advancement and that the Foundation and its funds are dedicated to scientific pursuits in accordance with Section 24 of Republic Act No. 2067, as amended by Republic Act No. 3589, such determination does not exempt the Foundation from the payment of the fixed and percentage taxes as contractor. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue