BIR Ruling [DA-241-03]

July 25, 2003 BIR RULING [DA-241-03] Section 101 (A) (2) BIR Rulings Nos. 95-99 & DA-267-00 Solid Video Corporation Solid House Building 2285 Pasong Tamo Ext. Makati City Attention: Mr. Bini A. Silva Accounting Assistant Gentlemen : This refers to your letter dated April 6, 2003 requesting for tax exemption for the total value of your donation to the Technical Education & Skills Development Authority (TESDA). It is represented that Solid Video Corporation is a domestic corporation duly organized and existing under the laws of the Republic of the Philippines; that it is engaged in the trading of broadcast and professional equipment, tapes and parts; that the Technical Education and Skills Development Authority (TESDA) was created under Republic Act (R.A.) No. 7796, otherwise known as the "Technical Education and Skills Development Act of 1994" or the "TESDA Act of 1994"; that TESDA replaced and absorbed the National Manpower and Youth Council (NMYC), the Bureau of Technical and Vocational Education (BVTE) and the personnel and functions pertaining to technical-vocational education in the regional offices of the then Department of Education, Culture and Sports (now Department of Education) and the apprenticeship program of the Bureau of Local Employment of the Department of Labor and Employment; that Solid Video Corporation intends to donate some of its obsolete inventories consisting of various broadcast and professional equipment to TESDA-Region IV-A (CALABARZON), a government institution duly organized and existing under the laws of the Republic of the Philippines; that the said equipment will be used in TESDA's training centers which offer electronic courses and allied trade areas; and that the donation is valued at cost amounting to P574,395.45. aATEDS In reply, please be informed that since the donee is an entity created by the Government pursuant to R.A. No. 7796, the aforementioned donation by Solid Video Corporation of various broadcast and professional equipment to TESDA-Region IV-A (CALABARZON), is exempt from the payment of donor's tax pursuant to Section 101(A)(2) of the Tax Code of 1997. Moreover, the aforesaid Deed of Donation is not subject to the documentary stamp tax udder Section 196 of the Tax Code of 1997 but only to the documentary stamp tax of P15.00 on certification under Section 188 of the same Code. 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. aCIHcD Very truly yours, Commissioner of Internal Revenue By: (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service