BIR Ruling

December 20, 1972 Caltex (Philippines) Inc. P. O. Box 783 Manila Attention: Mr . F . R . Ortega Tax Counsel Gentlemen : This refers to your letter dated November 23, 1972 requesting confirmation that you continue paying the annual fixed taxes for each of your establishments under Sections 182(A)(1) and 182(A)(2), P50.00 and the maximum of P2,000.00 each, which you believe is in accordance with the provisions of Section 178 of the Tax Code considering that these establishments are sales offices. aisadc In reply, I have the honor to inform you that as you are a manufacturer of petroleum or other manufactured oils and fuels from petroleum, you are subject to the P2,000.00 annual fixed tax prescribed by Section 182(A)(3)(v) of the Tax Code and not to the P50.00 annual fixed tax imposed in Section 182(A)(1) of the same Code. However, as such manufacturer, you are not subject to the graduated annual fixed tax prescribed by Section 182 (A)(2) on your sales of your manufactured products. The first clause of Section 178 of the Tax Code; "the tax on business is payable for every separate or distinct establishment or place where business subject to the tax is conducted," contemplates a case where a person who, although engaged in only one particular class of business, nevertheless, maintains two or more separate and distinct establishments for the operation of his business, in which case the fixed tax is imposed upon each of the separate and distinct establishment where the business subject to the tax is conducted. (See Ilagan et al. vs. Collector, CTA Case No. 43, July 25, 1956; BIR Ruling No. 71-011, July 16, 1971). Consequently, every branch establishment where your manufactured petroleum products are stored and sold is subject to the P2,000.00 annual fixed tax imposed in Section 182(A) (3)(v) of the Tax Code, (BIR Ruling No. 72-021, Aug. 28, 1972.) Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue