BIR Ruling

June 8, 1976 Taxes to be Paid by a Foreign Controlled Corporation Organized in Philippines and Engaged in Manufacture of Carbon Brushes This refers to your letter dated May 18, 1976, requesting advice on the taxes that may be due from you under the following facts: "We are a British controlled corporation organized in the Philippines. One of our business activities is to make carbon brushes for industrial purposes. "From imported and some locally purchased materials, we contract to make carbon brushes on specific orders of customers. Each job order specifically indicates the quantity required, the size, form and other specifications, as well as the unit price. "All the carbon brushes we make are in accordance with customer's orders, and no two job orders are exactly the same, except in the case of a repeat order from the same customer. "Based on the above facts, may we know the tax or taxes our firm will pay to the government." In reply, I have the honor to inform you that you are considered a contractor, subject to the fixed annual tax of P50.00 imposed by Section 182(A)(1) of the Tax Code and to the contractor's tax of 3% on your gross receipts, pursuant to Section 191 of the Code, as amended. cdtech