BIR Ruling

July 9, 1976 Domingo, Villanueva & Ricafrente Attorneys-at-Law P. O. Box 451 CCPO Makati, Rizal Attention: Atty . Jose M . Ricafrente Gentlemen : This is in reply to your letter dated June 28, 1976 for and in behalf of a client requesting our opinion as to whether or not a company which intends to sell consumer products abroad thru an export agent is considered exporter and therefore exempt from the 7% sales tax. aisa dc Articles exported by manufacturers or producers shall be exempt from sales tax. This exemption applies only to direct sales by manufacturers or producers to foreign buyers. It does not apply to sales to local dealers even if the articles or goods sold are subsequently sold abroad. Hence, if your client company manufactures or produces the articles or goods it exports abroad, although thru an agent, then it is an exporter exempt from the 7% sales tax. However, your agent shall be considered as a commercial broker, subject to the annual fixed tax of P300.00 prescribed by Section 182(A)(3)(bb) of the Tax Code and his gross compensation shall be subject to the 6% tax imposed in Section 195 of the same Code. 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."