BIR Ruling
BIR Ruling • Bureau of Internal Revenue (BIR) Issuances • Rulings (Unnumbered) • Jun 29, 1977
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June 29, 1977 Importation of Water Heater Equipment Powered by Sun Rays Not Subject to the 40% Sales Tax This refers to your letter dated May 12, 1977 informing this Office that you are making a project study on the importation of solar water heater equipment and you would like to know the rate of advance sales tax applicable to the said importation. It appears that said equipment does not use as power to run it oil, gas or electric, or any form of fuel, but the heat of the sun rays. asia In reply thereto, I have the honor to inform you that under Section 185(i) of the Tax Code, water heater powered by electric, gas or oil is subject to the 40% sales tax. Accordingly, if as represented by you, the imported water heater in question is not powered by electric, gas or oil, the same is only subject to 7% advance sales tax based on the total landed cost thereof plus 25% mark-up, in accordance with Section 186 in relation to Section 185(b), both of the Tax Code.
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