BIR Ruling

June 13, 1967 The Acting Regional Director Revenue Region No. 11 Naga City S i r : This refers to your letter dated April 3, 1967 stating the following: prll "I have the honor to request information as to whether or not the GSIS, performing proprietary functions, who owns lots and buildings which are leased or rented to other government agencies and private entities are exempt from payment of the following: (a) C-8 (b) Income tax as far as the income from rentals of lots and buildings are concerned (c) Additional residence tax This query is premised on the ground that the GSIS is claiming exemption from payment of any and all taxes pursuant to Section 28(c) of CA 186, as amended by RA 728, which is quoted hereunder: "(c) Except as herein otherwise provided, the Government Service Insurance, System, all benefits granted under this Act, and all its forms and documents required of the members shall be exempt from all types of taxes, documentary stamps, duties, contributions, fiscal or municipal direct or indirect, established or to be established; and more specially, they shall not be subject to the provisions of Act Numbered Twenty-four hundred and twenty seven, as amended, and no law hereafter enacted shall apply to said System unless it is provided therein that the same is applicable to the System by expressly stating the name of said entity." In reply, you are informed that based on the aforequoted facts, the Government Service Insurance System although ordinarily can be considered a real estate dealer under Section 194(s) of the Tax Code, is exempt from the payment of the annual fixed tax prescribed in Section 182(A)(3)(s) of the same Code for the reason that the exemption under the law aforecited covers all taxes directly payable by it from its operation. LexLib Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue