BIR Ruling

August 22, 1977 Messrs. Sycip, Gorres, Velayo & Co. Certified Public Accountants 6760 Ayala Avenue, Makati, Rizal Attention: Atty . M . Gutierrez Tax Division Gentlemen : This refers to your letter dated May 22, 1976 requesting confirmation that the dividends to be remitted by your client, Nutritional Products, Inc., to one of its nonresident foreign corporate stockholders, Nestle Alimentana, S.A., are subject to withholding tax at the rate of 15% only, in accordance with Section 24(b)(1) of the Tax Code, as amended by Presidential Decree No. 369. In reply, I have the honor to inform you that it appearing from the certification issued by the Head of the Cantonal Tax Administration, Canton of Vaud, Department of Finance, Lausanne, Switzerland, attested to by Vice Chancellor Robert Bocard of the Swiss Federal Chancery, whose position and signature are authenticated by Philippine Consul General Renato A. Urquiola, that the dividends which Nestle Alimenta, S.A. receives from your client, Nutritional Products, Inc., are exempt from income tax, pursuant to Section 59 of the Swiss Federal Law on Direct Taxes, said dividends are subject to income tax at the rate of 15% only, pursuant to Section 24(b)(1) of the Tax Code, as amended by Presidential Decree No. 369. Accordingly, your client should withhold from the dividends payable to the aforenamed nonresident foreign corporation 15% thereof. This letter will serve as the confirmation required by the Central Bank in connection with your clients' remittance of dividends to Nestle Alimentana, S.A. of Switzerland. Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-P4519-F2828-A-8