BIR Ruling

May 19, 1975 Mrs. Din B. Abaya President HPC Officers' Ladies Club Camp Crame, Quezon City M a d a m : This refers to your letter dated May 15, 1975 stating that the HPC Ladies Club has launched Operation "Bigay Tulong", a project which envision a multi-channel telecast of a movie film which will be procured free of charge from any benevolent movie producers; that you have appealed to the managers of the different television stations in the Greater Manila Area to telecast the movie free of airtime charges; that Cinematographic, Inc. which has been appointed as your sole marketing agency for the operation will undertake management operations, marketing negotiations and collection payments for and in behalf of the HPC Ladies Club; that the funds to be realized from advertises in the television broadcast will be devoted exclusively for the benefit of enlisted men fighting in Mindanao and their dependents whom they left in the Greater Manila and elsewhere. Under the foregoing facts, you request that the funds/revenues realized from Operation "Bigay Tulong" be given tax exemptions. casia In reply, I have the honor to inform you that the proceeds to be realized by that Club from Operation "Bigay Tulong" shall be exempt from income tax. However, the fee of Cinematographic, Inc. for undertaking the operations, marketing negotiations and collection payments for and in behalf of that Club in connection with the foregoing project is subject to the 3% contractor's tax prescribed in Section 191 of the Tax Code. Moreover, said fee shall form part of the income of Cinematographic, Inc. for income tax purposes. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue TAN-1601-593-5