BIR Ruling

June 2, 1976 Messrs. Sycip, Gorres, Velayo & Co. Certified Public Accountants 6760 Ayala Avenue, Makati, Rizal Attention: Atty . M . Gutierrez Tax Division Gentlemen : This refers to your letter dated March 31, 1976 requesting confirmation that the dividends received by your client, Mitsubishi Corporation, and then remitted to its Head Office in Tokyo by local companies are subject only to the final dividend tax of 10%. It is represented that Mitsubishi Corporation, a foreign corporation organized and existing under the laws of Japan, is licensed to do and is actually engaged in business in the Philippines under Certificate of Registration No. 491, issued by the Securities and Exchange Commission on March 20, 1967; that its Office is located at Room 601 Sarmiento Building, Ayala Avenue, Makati, Rizal; that it has several equity investments in local companies; and that during the period from July 1 to December 31, 1975, the local companies declared dividends payable to Mitsubishi Corporation, which are remitted to its Head Office in Tokyo. In reply, I have the honor to inform you that under the above facts your client, Mitsubishi Corporation, is a resident foreign corporation doing business in the Philippines, as defined under Section 84(g) of the Tax Code. Accordingly, the dividends received by the corporation are subject to a final dividend tax of 10% only in accordance with Section 24(c) of the Tax Code, as amended by Presidential Decree Nos. 778 and 913. However, if your client remits said dividends to its Head Office in Tokyo, it shall be liable to 20% tax on the amount to remitted in addition to the 10% tax paid thereon. (See Section 15(b) (2) of Revenue Regulations No. 2, as amended by Revenue Regulations No. 8-75) cdta Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3