BIR Ruling

December 21, 1970 The San Miguel Corporation 6766 Ayala Avenue Makati, Rizal Attention: Mr . Ernest Kahn Executive Vice President-Finance Gentlemen : With reference to your letter dated December 17, 1970, I have the honor to inform you that in our letter to you dated November 20, 1956 it was held that the amount of P550,000 representing your company's contribution to its Health Welfare and Retirement Plan is deductible from gross income for the taxable year pursuant to Section 30 (j), in relation to Section 30(a) both of the Tax Code. It was in no wise meant that the amount of P550,000 is to be the company's fixed and invariable amount of contribution to the retirement plan. The amount of P550,000 was then specified because as projected by you it represented 3 1/2% of the then current payroll which percentage was ascertained by you sufficient to place the retirement fund on a sound condition. If, therefore, the company's payroll has increased, the amount of contribution to the fund shall be ascertained on the basis of 3 1/2%, of the payroll during the taxable year. cdta Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue