BIR Ruling [DA-314-97]

September 10, 1997 BIR RULING [DA-314-97] Solid Development Corporation 1927 Jorge Bocobo St. Malate, Metro Manila Attention: Mr. Alfonso P. Castillo Vice President Gentlemen : This refers to your letter dated June 16, 1997 requesting for the issuance of another certificate of exemption from the expanded withholding tax pursuant to Revenue Regulations No. 12-94. It appears that on April 17, 1995, this Office had already issued you a certificate of exemption from the expanded withholding tax pursuant to RR No. 12-94, pertinent portions of which are quoted hereunder as follows: "xxx xxx xxx "Documents submitted show that Solid Development Corporation, a BOI-registered enterprise with Certificates of Registration Nos. EP-93-346 and EP-94-625, is an expanding producer of spun yarn on a non-pioneer status under Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987. AaECSH "xxx xxx xxx "Accordingly, since you are registered with the BOI and enjoying exemption from the payment of income tax for a period of three (3) years from October 1994 or from the actual start of commercial operations, whichever comes first, in accordance with the Omnibus investments Code of 1987, this Office is of the opinion as it hereby holds that you are exempt from the creditable expanded withholding tax imposed under Revenue Regulations No. 12-94 on income payments received by your company (BIR Ruling No. 163-94 dated December 12, 1994)" You alleged further that the BOI issued a new Certificate of Registration No. EP-94-625 dated December 28, 1994 for an additional 20,000 spindles to cover the expansion program of the corporation, the start of the commercial operation of which will be by July 1997 to run for three years. You are therefore applying for a new Certificate of Exemption from the coverage of the expanded withholding tax on the production and sales covered by BOI Certificate of Registration No. EP-94-625. IADaSE In reply, please be informed that inasmuch as the terms and conditions appended to your Certificate of Registration No. EP-94-625 dated December 28, 1994 states that you are entitled to income tax holiday of three (3) years from July 1997 or actual start of commercial operation, whichever comes first, but not earlier than the date of registration on December 28, 1994, you shall be exempt from the expanded creditable withholding tax beginning July 1997 or the ACTUAL start of your commercial operation, whichever comes first, on the income payments being made by your company on your production covering your expansion program under BOI Certificate of Registration No. EP-94-625 pursuant to Revenue Regulations No. 12-94 (BIR Ruling No. 163-94 dated December 12, 1994). This ruling is issued on the basis of your representations. If, however, upon investigation, it will be disclosed that the facts are different, this ruling shall be considered null and void from the date of issuance. Very truly yours, (SGD.) SIXTO S. ESQUIVIAS IV Assistant Commissioner Legal Service