Manila Water Company, Inc.

June 11, 2008 BIR RULING [DA-351-08] E.O. 226; DA 127-07; 02/28/07 Manila Water Company, Inc. Katipunan Road, 1105 Balara Quezon City Attention: Armi R. Santos Sr. Manager, Accounting Department Gentlemen : This refers to your letter dated April 17, 2008, requesting for Tax Exemption Certificate pursuant to Revenue Regulations No. 2-98, as amended, on account of the registration of your Antipolo Water Supply and Distribution Project (Project) with the Board of Investments (BOI) under Executive Order (E.O.) No. 226, otherwise known as the "Omnibus Investments Code of 1987." DHEcCT As represented, the Project is duly registered with the BOI per Certificate of Registration No. 2008-053 dated March 3, 2008 as expanding operator of Antipolo water supply and distribution on a pioneer status under the Omnibus Investments Code of 1987 (E.O. 226); that it is entitled to the income tax holiday (ITH) incentive for a period of three (3) years from its registration date; and that the income tax holiday shall be limited only to revenue generated from the Project's registered activity. In reply, please be informed that under Section 2.57.5 (B) (2) of Revenue Regulations No. 2-98, as amended by Revenue Regulations No. 6-2001 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 income tax as provided under Republic Act No. 7916 and E.O. No. 226. Accordingly, since the Project 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 three (3) years reckoned from March 3, 2008, this Office is of the opinion as it hereby holds, that it is exempt from the payment of the creditable withholding tax imposed under Revenue Regulations No. 2-98, as amended by Revenue Regulations No. 6-2001 on income payments received by it during the specified period in connection with its registered activity. TcSaHC 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 null and void. Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service