BIR Ruling

April 7, 1976 Messrs. Del Rosario & Co. Certified Public Accountants 666 T. M. Kalaw Street, Ermita Manila Gentlemen : This refers to your request in behalf of your client, the Credit Management Association of the Philippines Inc., for exemption from the payment of income tax and the filing of the corresponding income tax return under Section 27(f) of the Tax Code. Investigation conducted by this Office disclosed that your client, Credit Management Association of the Philippines Inc.,is a non-stock, non-profit corporation duly registered with the Securities and Exchange Commission; that the Corporation is charged with the duty of credit investigation of debtors and would-be debtors of member firms; that the amount of such credit to be extended to applicants for credit are disseminated to the other member firms for confirmation of the credit standing of such would-be debtors; that the Corporation shall be maintained by membership dues and that no part of its net income inures or accrues to the benefit of any private individual or member. It has been held that associations which provide members with credit or other financial information do not qualify as a business league. (Northwestern Jobbers Credit Bureau v. Com. 37 F. (2d) 880; Greater New York, Inc. v. Com.,162 F. (2d) 7; 34 Am. Jur. 2d p. 658-659.) In view thereof, your client, the Credit Management Association of the Philippines Inc., cannot be considered a business league within the purview of Section 27(f) of the Tax Code. Consequently, it should file an income tax return and pay income tax on its net income. aisa dc Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3