BIR Ruling

January 19, 1967 The General Manager Marconi Electronics Corporation 1175 Pasong Tamo Makati, Rizal S i r : This refers to your letter dated August 3, 1966 requesting reconsideration of our ruling contained in our letter to you dated July 15, 1966 holding that inasmuch as you are not actually manufacturing the parts mentioned in your letter dated February 22, 1965, for the purpose of assembling or fitting them with other articles or intermediate component parts that you manufacture for sale remain subject to the 30% tax under Section 185-B of the Tax Code. In reply, I have the honor to inform you that under Republic Act No. 412 (now Section 185-B of the Tax Code), only manufacturers of "locally manufactured articles" are entitled to the reduced rate of tax. The words "locally manufactured articles" mean articles manufactured in a manufacturing enterprise which processes physically and/or chemically raw materials such as copper clad boards, silicon, steel laminations, other metal sheets, wires, plastic powder and/or pellets, fiber boards, wood, metallic and non-metallic tubes, rods, special paper, etc., into various intermediate components and parts, and subsequently assembling or fitting them together with other collaterals or intermediate components and parts, into such completed and finished articles. As you are only a manufacturer of stereo and television parts, you do not quality to the reduced rate of tax. Finding therefore no cogent reason to reconsider our ruling, your request is hereby denied. aisadc Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue