BIR Ruling [DA-318-04]

June 11, 2004 BIR RULING [DA-318-04] Sec. 151 172,99; 114-96 Ferna Corporation 16 Bernardo St., San Rafael Village Navotas, Metro Manila Attention: Mr. Peter C. Co General Manager Gentlemen : This refers to your letter dated May 24, 2004 requesting for a ruling to the effect that the importation of Pure Vacuum Dried (PVD) Iodized Salt by Ferna Corporation is not subject to the excise tax imposed under Section 151 of the Tax Code of 1997. In reply thereto, please be informed that in BIR Ruling No. 072-99 dated May 24, 1999, this Office had the occasion to rule that the importation of Pure Vacuum Dried (PVD) Iodized Salt is subject only to the 10% value-added tax (VAT) prescribed under Section 107(A) of the Tax Code of 1997 but not to the excise tax imposed under Section 151 of the same Code. The above ruling that the importation of PVD Iodized Salt is not subject to excise tax is based on the findings that said imported salt does not fall under the definition of mineral products which is defined under Section 151(B)(3) of the Tax Code to mean as "things produced and prepared in a marketable state by simple treatment processes such as washing or drying, but without undergoing any chemical change or process or manufacturing." Moreover, in BIR Ruling No. 114-96 dated October 29, 1996 this Office ruled that the "salt" being classified in Revenue Regulations No. 13-94, 1 as among the other non-metals, pertains to rock salt only which is mined or quarried like other minerals. Based on the foregoing, the importation of Pure Vacuum Dried (PVD) Iodized Salt by Ferna Corporation is not subject, therefore, to the excise tax imposed under Section 151 of the Tax Code of 1997. ScEaAD This serves as the authority of Ferna Corporation to secure the release of the aforesaid importation from customs custody without the payment of the excise tax. Very truly yours, (SGD.) JOSE MARIO C. BUAG Deputy Commissioner Legal and Inspection Group Footnotes 1. Revenue Regulations governing the taxation of minerals and mineral products.