BIR Ruling

August 13, 1970 Miss Elvira Y. Mondejar New Aguilar Hotel 1095 Aguilar St. Manila M a d a m : This refers to your letter dated July 29, 1970 stated as follows: "According to today's Manila Times Valencia's Column, hotel customers while paying their bills must add 5 per cent documentary stamp and 5 per cent science stamp tax. "But some of the BIR examiners ask the small hotel owners to affix every sales receipts with one peso documentary stamp and one peso science stamp regardless what is the amount involved. If a customer pays four pesos for a few hours room rent and is required to pay additional two pesos for stamps, that would be 50 per cent over his bill. "Kindly clarify how much is the minimum charge of these two kind of stamps for a hotel sales receipt, and give your guidance as soon as you are convenient." In reply, I have the honor to inform you that pursuant to Section 226(b) of the Tax Code, as amended by Republic Act No. 6110, on each hotel receipt issued by keepers of hotels, motels, resthouses, lodging houses or resorts to a guest for logging, there shall be collected a documentary stamp tax of P1.00 on each P20.00 or fractional part thereof. In addition, there shall be collected a science stamp tax in the same amount as that of the documentary stamp tax. (Republic Act No. 5448.) In other words, although the amount charged is less than P20.00 a receipt should be issued and the same is subject to a documentary stamp tax of P1.00 and to an additional science stamp of P1.00. (BIR Ruling No. 66-037, December 15, 1966) Such being the case, in the example given by you where a guest pays only P4.00 for room rent (lodging), the hotel receipt issued therefor is subject to the documentary stamp tax of P1.00 and a science stamp tax of the same amount. cdta Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue