Hacienda Primera Development Corp.

May 16, 2008 BIR RULING [DA-300-08] RR 2-98; BIR Ruling No. DA-349-04 Hacienda Primera Development Corp. Pan 002-06 Ester A. Lim Drive Tawala, Panglao Bohol Attention: Ms. Anna Katrina H. Cauton General Manager Gentlemen : This refers to your letter dated February 28, 2008 requesting for a written confirmation that since Hacienda Primera Development Corp. (HPDC) is entitled to Income Tax Holiday for four (4) years on account of its registration with the Board of Investments (BOI) under Executive Order No. 226, otherwise known as the "Omnibus Investments Code of 1987," it is, therefore, not subject to expanded withholding tax pursuant to Revenue Regulations (RR) No. 2-98, as amended. Documents show that HPDC is a corporation duly registered with the Board of Investments as a "New Operator of Tourist Accommodation Facility (Resort)" on a non-pioneer status under Certificate of Registration No. 2007-098 dated June 15, 2007. HPDC has been granted a four-year income tax holiday incentive from date of registration or June 15, 2007. In reply, please be informed that under Section 2.57.5 (B) (2) of RR No. 2-98, as amended, implementing Section 57 (B) of the Tax Code of 1997, as amended, the withholding tax prescribed in the said Regulations shall not apply to income payments to persons enjoying exemption from the income tax provided by Republic Act No. 7916 and the Omnibus Investments Code of 1987. Accordingly, since HPDC is a BOI-registered enterprise, enjoying exemption from payment of income taxes pursuant to the provisions of Section 39 (a) (1) of the Omnibus Investments Code of 1987 for a period of four (4) years reckoned from June 15, 2007, this Office is of the opinion as it hereby holds, that it is exempt from the payment of the creditable withholding tax imposed under RR No. 2-98, as amended, on income payments received by it during the aforementioned period with respect to its registered activity. ScaCEH 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.) JAMES H. ROLDAN Assistant Commissioner Legal Service