BIR Ruling

April 25, 1975 Mr. Ray Dean Salvosa Executive Vice-President Baguio Colleges Foundation Baguio City S i r : This refers to your letter dated February 26, 1975 stating among others, that the Baguio Colleges Foundation, a non-stock, non-profit educational foundation established and organized in accordance with law, desires to purchase from Sgt. Charles Selby of John Hay Air Base second hand personal effects consisting of Sansui Amplifier, Sansui Speakers, Sansui Tape Deck and Silverstone 19" Color TV; that the said equipment will be used by the Foundation actually, directly and exclusively for educational purposes. cdti On the basis of the foregoing, you would like to request our opinion on the following: "1. Whether or not the Foundation is liable for any tax under existing laws; and if there are, if we may request that it be waived; "2. Whether or not there are requirements which must be complied with by the Foundation before perfecting and/or consummating the sale with the vendor." In reply, I have the honor to inform you that Section 8 of Republic Act No. 6055 provides as follows: "SEC. 8. The foundation shall be exempt from the payment of all taxes, import duties, assessments, and other charges imposed by the Government on all income derived from or property, real or personal, used exclusively for the educational activities of the Foundation." It being represented that the aforesaid second hand articles to be purchased from Sgt. Charles Selby, a tax-exempt person, will be used actually, directly and exclusively for educational purposes, it is the opinion of this Office as it hereby holds that the aforesaid articles are exempt from the compensating tax in accordance with the aforesaid provision of Republic Act No. 6055. Your exemption from the payment of the compensating tax as aforesaid is predicated on the assumption that Baguio Colleges has converted itself to a non-profit educational foundation in accordance with the provisions of Republic Act No. 6055. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue TAN-1601-593-5 "TAXPAYERS SHOULD INDICATE THEIR TAN IN ALL COMMUNICATION TO THE BIR."