BIR Ruling

January 22, 1969 Kuenzle & Streiff, Inc. P. O. Box 301 Manila Attention: Mr . J . L . Santos Insurance Department Gentlemen : This refers to your letter dated December 11, 1968 stating in part as follows: "We have noted that the effectivity of this law (R.A. 5448) will commence on January 1st, 1969. However, it does not clearly state whether the new law applied to: 1. Insurance Policies issued, say, on December 20, 1968 but whose term of coverage will yet commence for example: From January 1st, 1969 To January 1st, 1970 or to 2. Insurance Policies issued, any, on January 1st, 1969 but whose term of coverage have commenced for example: From December 20, 1968 To December 20, 1969 "We hope, therefore, to be clarified re the application of the said law whether its effectivity will be based upon the date of issuance or upon the date of effectivity or commencement of the policy." In reply, I have the honor to inform you that the date of effectivity or commencement of an insurance policy is not the basis for purposes of imposing the documentary stamp tax thereon but the date of issuance thereof to the insured pursuant to Section 210 of the Tax Code. The science stamp tax is collected at the same time as the documentary stamp tax imposed under the National Internal Revenue Code, as amended, pursuant to Section 4 of Republic Act No. 5448. In view of the foregoing, the insurance policy in your first example is not subject to science tax, whereas in the second, it is subject. aisadc Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue