BIR Ruling

March 9, 1972 Sarmiento Securities Corporation VECA, Bldg., Pasong Tamo, Makati, Rizal Attention: Mr . Francis X . Perez Gentlemen : This refers to your letter dated January 19, 1972 requesting information as to the tax liabilities of a corporation which is: 1. An importer of drugs but which merely repacks the imported merchandise; and 2. An importer of stereo, loudspeakers and similar items which are subsequently sold as is (complete without need of assembly) to the public. In reply, I have the honor to inform you as follows: 1. An importer of drugs in bulk which are repacked in small containers preparatory to the sale thereof is subject to the P50.00 annual fixed tax prescribed in Section 182(A)(1) of the National Internal Revenue Code and the imported drugs are subject to the 7% advance sales tax based on the landed cost thereof plus 25% mark-up pursuant to Section 183(b) in relation to Section 186 both of the said Code. 2. An importer of stereo, loudspeakers and similar items which are subsequently sold as is, to the public is subject to the P50.00 annual fixed tax prescribed in Section 182(A)(1) of the Tax Code, and the imported stereo, loudspeakers and similar articles are subject to the 40% advance sales tax based on the landed cost thereof, plus 50% mark-up pursuant to Section 183(b) in relation to Section 185-B, both of the same Code. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue