BIR Ruling

January 7, 1977 Messrs. Ozaeta, Romulo, De Leon Mabanta & Reyes 4th Floor, JMT Building 6764 Ayala Avenue Makati, Rizal Gentlemen : This refers to your letter dated October 26, 1976 requesting certification from this Office that the dividends which your client, IBM (Philippines) Inc., will remit to IBM World Trade Corporation is subject to withholding tax at the rate of 15%, instead of 35%. It appears that your client is a domestic corporation, 99% of the capital stock of which is owned by the aforenamed recipient corporation; and that said corporation is a non-resident foreign corporation domiciled in U.S. In view thereof, and considering that under the present provisions of the U.S. Federal Tax Code, the amount of tax deemed paid on such dividends, and accordingly, to be credited against U.S. tax on said dividends exceeds the 20% requirement of Presidential Decree No. 369, this Office hereby certifies that the dividends which your client will remit to IBM World Trade Corporation domiciled in U.S. are subject to withholding tax at the rate of 15% only. (BIR Ruling No. 76-004 dated July 19, 1976). aisadc Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3 "TAXPAYERS SHOULD INDICATE THEIR TAN IN ALL COMMUNICATIONS TO THE BIR."