BIR Ruling [DA-027-04]

January 16, 2004 BIR RULING [DA-027-04] 148 (c); 107 (A) DA-033-02 Asia Pacific Primestar, Inc. Unit W1205 Phil. Stock Exchange Centre Tower 2 Ortigas Center, Pasig City Attention: Virginia P. Canlas Chief Accountant Gentlemen : This has reference to your letter dated December 4, 2003 requesting for a ruling as to whether or not the candles which Asia Pacific Primestar, Inc. (APPI), is importing is subject to excise tax. It is represented that APPI is an importer and national wholesaler of consumer items such as books, toys, household products and novelty items. Recently, APPI imported some candles specifically the 6-pc fruit candles and the candles 12 assorted tin. Allegedly, the Bureau of Customs (BOC) believes that candles are subject to excise tax. However, upon application of the Authority To Release Imported Goods (ATRIG) with the Bureau of Internal Revenue (BIR), an information was given that candles are not subject to excise tax. In view of this conflicting opinion, you now sought this Office to rule on the matter. In reply, please be informed that candles are not among the articles enumerated in Section 148 of the Tax Code of 1997 as subject to excise tax. However, paragraph (c) thereof provides that waxes and petrolatum shall be subject to the excise tax of three pesos and fifty centavos (P3.50), per kilogram. Accordingly, the candles imported by APPI whether derived from petrolatum products or from plant or animal sources (paraffin wax) shall be subject to excise tax on their wax content pursuant to Section 148(c) of the Tax Code of 1997 and to the 10% VAT under Section 107(A) of the same Code. (BIR Ruling No. DA-033-02 dated March 7, 2002) This ruling is being issued on the basis of the foregoing facts as represented. However if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. ASIDTa Very truly yours, (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal and Inspection Group