BIR Ruling [DA-211-96]

June 25, 1996 BIR RULING [DA-211-96] MEMORANDUM TO : Mr. Jose C. Obtinario Revenue District Officer Revenue District No. 36 Puerto Princesa City This refers to your letter dated March 19, 1996 requesting for the revocation of a ruling earlier issued by this Office in favor of P.T.A. Seminario de San Jose and Rotunda Brotherhood, Inc., both of Puerto Princesa City. Contrary to your allegation, the adverted ruling, BIR Ruling No. 239/000-00/159-95 dated October 16, 1995, is duly signed and numbered, a xerox copy of the duplicate copy of which is hereto attached for your information, guidance and ready reference. Needless to state, it was promulgated pursuant to the power expressly granted to the Commissioner of Internal Revenue under Section 245 of the Tax Code, as amended. cdtech It must be emphasized herein that the said ruling was issued on the basis of the written representation made by Ms. Rufina I. Lina, in behalf of P.T.A. Seminario de San Jose and Rotunda Brotherhood, Inc., stating the facts attendant to the holding of the raffle draw held on October 18, 1995 and how the Authority to Print the raffle tickets for the draw was secured, all supported by various documents presented to this Office. Since there was no deliberate omission of material facts committed by the person to whom the adverted ruling was issued, its reversal or modification is clearly not justified. At any rate, you are probably aware that under Section 239 of the Tax Code, as amended, an Authority to Print must first be secured by a printer before he can print receipts or sales or commercial invoices . Under Revenue Regulations No. 2-78, "receipt" is defined as a written admission or acknowledgment of the fact of payment in money or other settlement between seller and buyer of goods, debtor and creditor, or persons rendering services and client or customer, while "sales or commercial invoice" is a written account of goods sold or services rendered and the prices charged therefor, or a list of goods consigned and the value at which the consignee is to receive them or any other list by whatever name it is known which is used in the ordinary course of business evidencing sale and transfer or agreement to sell or transfer goods and services, e.g., purchase orders, job orders; provisional and temporary receipts, etc; except (1) freight stub receipts; (2) passage tickets; and (3) amusement tickets and other similar receipts which are governed by Revenue Regulations No. V-1, as amended. Since indubitably a raffle ticket is neither a receipt nor a sale or commercial invoice, it follows that an Authority to Print the same is not necessary, neither is it subject to registration and approval by the Bureau of Internal Revenue. This is the legal basis for BIR Ruling No. 239/000-00/159-95. In fine, what you should do as the Revenue District Officer of Palawan is to see to it that the corresponding 20% final tax imposed under Section 21 (c) (1) of the Tax Code, as amended, is collected before the prizes (except prizes amounting to P3,000 or less) are delivered to the winner/s and that the spouses Loreto and Rufina Lina have correctly declared in their individual income tax returns the income derived by them as financiers of raffle draws. cdt LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue