BIR Ruling

June 29, 1976 Feliciano F. Miravite, Inc. Suites 305-309 Sarmiento Bldg. Ayala Avenue, Makati, Rizal Attention: Mr . Feliciano F . Miravite President and Actuary Gentlemen : This refers to the Bataan Pulp and Paper Mills, Inc. Retirement Plan which you submitted to this Office for determination of qualification under Republic Act No. 4917. A close perusal of the Plan, the Trust Agreement and the Actuarial Report disclosed the following: 1. It is a definite written program; 2. It is more or less permanent in character; 3. It covers all regular employees of the company; 4. It is non-discriminatory; 5. It provides for the establishment of a Trust Fund. In this connection, it is represented that the company will start funding upon approval of the Plan. 6. It is duly trusteed; and 7. Finally, it provides that no part of the corpus or income of the Trust Fund shall be used for or diverted to purposes other than for the exclusive benefit of the member-employees and their beneficiaries. Having met the requirements of the law and regulations, the Bataan Pulp and Paper Mills, Inc. Retirement Plan qualifies as a reasonable retirement plan within the contemplation of Republic Act No. 4917, and as such, it shall be entitled to all benefits and privileges provided for by said Act, as follows: 1. The retirement benefits to be received by the member-employees shall be exempt from all taxes; 2. The income of the Trust Fund from its investments are exempt from income tax; and 3. The contributions of the Bataan Pulp and Paper Mills, Inc. to the retirement fund are deductible from its gross income. The company's contributions to the Fund to cover past service liability should be apportioned in equal parts over a period of ten consecutive years beginning with the year in which the transfer or payment is made pursuant to Section 30(j) of the Tax Code as amplified by Section 118 of the Income Tax Regulations. It is of course understood that the Plan shall continue to qualify thru all the years that it shall be in operation and that all forfeitures arising under the operation of the Plan shall be applied to reduce employer contributions. Finally, any modification or amendment that shall hereafter be made to the Plan should be submitted to this Office for certification that any such amendment or modification does not affect the qualification of the Plan. cdta Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3 "TAXPAYERS SHOULD INDICATE THEIR TAN IN ALL COMMUNICATIONS TO THE BIR."