BIR Ruling

October 26, 1971 Interiors Home Furnishers 607-609 Echague St. Manila Attention: Mr . Marcos Yuen Proprietor Gentlemen : This refers to your letter dated October 23, 1971 requesting information as to the percentage tax you are liable to for engaging in the business of manufacturing furniture of all types, using materials mostly locally purchased. cdi In reply, I have the honor to inform you that for engaging in the manufacture of furnitures, you are a manufacturer subject to the P50.00 annual fixed tax imposed in Section 182(A) (1) of the Tax Code, and to the 7% sales tax on your sales of manufactured furnitures which are not upholstered, pursuant to Section 186 of the same Code. However, the sales of upholstered furniture is subject to the 40% sales tax imposed in Section 185(o) of the Tax Code, unless you apply and qualify as manufacturer of "locally manufactured articles" under the said section as implemented by Revenue Regulations No. 3-70 and 1-71. However, your export sales of furnitures whether upholstered or not is exempt from the sales tax pursuant to Section 188(e) of the Tax Code. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue