BIR Ruling [DA-212-03]

July 8, 2003 BIR RULING [DA-212-03] 50 (B); DA-553-99 Third Millenium Oil Mills, Inc. Rm. 403, CSP Bldg.,815 Quezon Ave., Quezon City Gentlemen : This refers to your letter dated February 26, 2003 requesting for a ruling exempting Third Millenium Oil Mills, Inc. from the 1% creditable withholding tax on income payments to you since you are a BOI-registered enterprise. Documents submitted show that you are a BOI-registered enterprise with Certificate of Registration No. 2001-065 dated April 23, 2001; that you are a producer of coconut oil and copra cake on a non-pioneer status with pioneer incentives, enjoying income tax holiday for a period of six (6) years reckoned, from the start of your commercial operation in August 2001 (per Specific Terms and Conditions of your BOI registration) or actual start of commercial operations. In reply, please be informed that Section 2.57.5(B)(2) of Revenue Regulations No. 2-98, as amended, provides that the withholding of creditable withholding tax therein prescribed shall not apply to income payments to corporations registered with the Board of Investments and enjoying exemption from payment of income tax provided by R.A. No. 7916 and the Omnibus Investment Code of 1987. Such being the case, and since you are a BOI-registered enterprise enjoying an income tax holiday for a period of six (6) years from the start of your commercial operations (August 2001 or actual start of commercial operations), income payments made to you from August 2001, the start of your commercial operation, until December 2006 shall not be subject to the 1% creditable withholding tax prescribed in Revenue Regulations No. 2-98, as amended (BIR Ruling No. DA-553-99 dated September 23, 1999) . TSDHCc Moreover, you can file a claim for tax creditor refund of the 1% creditable withholding tax which had been withheld by your customers for the years 2001, 2002 and 2003. 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 as null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal & Inspection Group