BIR Ruling

January 25, 1973 Mr. Felicito M. Domingo P. O. Box 451 CCPO Makati, Rizal S i r : This refers to your letter dated January 15, 1973 requesting information as to whether or not your client (company) which intends to sell consumer products abroad through the National Export Trading Corporation (NETRACOR) as the export agent can be considered an exporter and therefore, exempt from the 7% sales tax. In reply, I have the honor to inform you that under Section 188(e) of the Tax Code, articles shipped or exported by the manufacturer of producer, irrespective of any shipping arrangement that may be agreed upon which may influence or determine the transfer of ownership of the articles so exported, are exempt from the sales tax. It appearing in the submitted proforma contract of the NETRACOR with exporter companies and the procedures being followed by the NETRACOR regarding invoicing and payments that the manufacturer is still the exporter of his manufactured products, your client's export sales under the set-up may still be considered as an export sales, thus exempt from the sales tax pursuant to the aforesaid provisions of Section 188(e) of the Tax Code. Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue