BIR Ruling

May 7, 1969 The Medical Director Ospital Ng Maynila Manila S i r : This refers to your letter dated April 21, 1969 requesting exemption from amusement tax on the movie premier presentation to be undertaken by the Barangay Productions for the benefit of the Ospital Ng Maynila, which is scheduled on May 8, 1969 at the World Theater. In reply thereto, please be informed that it appearing that the entire proceeds of the benefit show will inure to the benefit of the Ospital Ng Maynila, as charitable project of the City of Manila, which gives free medical assistance to indigent city residents of Manila and suburbs, this Office is of the opinion and so holds that the admission fees to the aforementioned movie premier presentation shall be exempt from the amusement tax imposed in Section 260 of the Tax Code. This exemption springs from the concept that the establishment and maintenance of the Ospital constitutes the exercise by the City of Manila of its governmental functions. However, in order to be entitled to exemption, the following conditions and requirements must be met: 1. That the show or exhibition is actually undertaken by the beneficiary organization, or by another, for and in his behalf and exclusively for its benefit; 2. That the beneficiary organization shall file with the Director, BIR Revenue Region No. 7, North Manila, a report in triplicate within twenty (20) days from the last date the show or exhibition is held, stating (a) The number of tickets sold, classified according to the prices thereof and showing the serial numbers thereof; the form used in connection with the payment of the amusement tax shall be used for this purpose; and (b) The gross receipts or income derived from the show or exhibition, the expenses incurred in connection therewith, and the resulting net income. The said report should contain a certification by the president or responsible official of the beneficiary organization that the income from the show or exhibition sought to be exempted has inured or will inure exclusively to its benefit. cdt Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue