BIR Ruling [DA-036-05]

January 28, 2005 BIR RULING [DA-036-05] Section 109 (y); VAT Ruling No. 022-2000 JAVE Publishing House, Inc . 7344 A. Bonifacio Ext.,San Dionisio Paraaque City Attention: Mr . Virgilio L . Bago Vice President Gentlemen : This refers to your letter dated October 2, 2002 requesting for an exemption from the Value Added Tax pursuant to the provisions of Section 109 (y) of the Tax Code of 1997. It is represented that you are engaged in the business of publishing and printing of books as provided for by Republic Act No. 8047; that this request is made with the end-in-view of facilitating transaction with your local revenue offices and local government agencies as well and further avoid repetitive production of documentary proof of the same. In reply, please be informed tha Section 109, par. (y) of the Tax Code of 1997, the sale, importation, printing or publication of books and any newspaper, magazine, review or bulletin, which appears at regular intervals with fixed prices for subscription and sale and which is not devoted principally to the publication of paid advertisements, is exempt from the imposition of the Value Added Tax. As such, regardless of the amount of the said transaction, you will not be subject to the VAT and consequently from the creditable VAT. Neither will you be required to pay the 3% percentage tax under Section 116, in relation to Section 109(z) of the same Code. EAHcCT In view thereof, your business of publishing and selling of books is exempt from the payment of the Value Added Tax/Creditable Value Added Tax and from the 3% percentage tax. However, if you have other transactions (such as the printing of brochures) which are subject to the Value Added Tax, you will also be required to register your business as a VAT business entity and issue a separate VAT invoice/receipt to record such transactions. This ruling is being issued on the basis of the foregoing facts as represented. If upon investigation, it will be discovered that the facts are different, then this ruling shall be considered null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal and Inspection Group