BIR Ruling

December 5, 1975 Nutrition Center of the Philippines NCP Building South Superhighway (Nichols Interchange) Makati, Rizal D-3116 Attention: Mr . Florentino S . Solon, M . D . , M . P . H . Executive Director Gentlemen : This refers to your letter dated November 26, 1975 stating that the Nutrition Center of the Philippines (NCP) is the principal host to the People's Republic of China Acrobatic Troupe which arrived on November 7, 1975 and gave series of performance in Manila, Iloilo, Cebu and Cagayan de Oro City, that all expenses incident to the Troupe's stay in the Philippines including accommodation, transportation, etc. has been shouldered by the NCP; and that all the proceeds of their performances throughout the Philippines have been donated to the NCP for the benefit of the malnourished children. cd Under the foregoing circumstances, you now request for exemption from the payment of percentage taxes on their accommodation at the Philippine Village Hotel, Queen River Hotel in Iloilo, Montebello Hotel in Cebu and Alta Tierra Hotel in Cagayan de Oro City. In reply, I have the honor to inform you that your request cannot be granted for lack of legal basis. The 3% and 7% taxes levied on the gross receipts from the sale of food and drinks served to the members of the Acrobatic Troupe in accordance with Section 191-A of the Tax Code, and the 3% tax on hotel receipts prescribed in Section 191 of the same Code, are taxes directly payable by the hotel operators and not on the NCP which incidentally foots the bills of the visiting Acrobatic Troupe. It may be stated in this connection, that the exemption from the internal revenue and science and documentary stamp taxes on hotel receipts and the 3% percentage tax on the hotel revenue from the hotel room occupancy granted by Presidential Decree No. 31, as implemented by Revenue Regulations No. 10-72 dated November 8, 1972 is accorded only to foreign tourists and travellers and only if the payment of the hotel room charges is effected in any of the acceptable foreign currencies. Very truly yours, (SGD.) EFREN I. PLANA Actg . Commissioner of Internal Revenue TAN-1456-040-3 "TAXPAYERS SHOULD INDICATE THEIR TAN IN ALL COMMUNICATIONS TO THE BIR."