BIR Ruling [DA-359-00]

October 19, 2000 BIR RULING [DA-359-00] Sec. 109 (y); VAT Ruling 183-88; BIR Ruling 068-97 Zambrano & Associates Law Offices 27th Floor, 88 Corporate Center Sedeo corner Valero Streets Makati City Attention: Atty . Vilma Hilda D . Villanueva Gentlemen : This refers to your letter dated September 20, 1999 requesting in behalf of your client, Gospel Bookroom of the Philippines, Inc. (GBPI), for a ruling confirming that its importation and sale of religious books such as bibles, hymn books, etc., and its publication of religious books or by its printer are exempt from the 10% Value-Added Tax (VAT). It is represented that GBPI is a non-stock, non-profit religious corporation duly organized and existing under Philippine law; that the purposes for which it was incorporated as stated in its Articles of Incorporation are as follows: 1. To teach the Word of God and to preach the Gospel, according to the apostles' teaching as revealed in the New Testament and in accordance with the New Testament Ministry expounded by the Ministry of Watchman Nee and Witness Lee and recorded in the publications of the Living Stream Ministry and Stream Publishers. 2. To train church members in their spiritual functions in order that such members may participate in the teaching of the Word of God and the preaching of the Gospel pursuant to the New Testament Ministry as expanded by the Ministry of Watchman Nee and Witness Lee. 3. To print, publish, produce, or otherwise distribute and circulate literature, audiotapes and videotapes, and to conduct seminars, training and other activities, related to the propagation, teaching and preaching of the Word of God and the Gospel as expounded by the Ministry of Watchman Nee and Witness Lee and for this purpose prepare faithful translation from the original text of the publications of the Living Stream Ministry and Stream-Publications into Philippine languages and dialects and ensure the faithful adherence to the Ministry of Watchman Nee and Witness Lee. IAcDET 4. To solicit and receive grants, gifts, donations, bequests, and to enter into contracts with individuals, organizations, corporations, or other entities solely for the abovementioned purposes and to administer the proceeds of such grants, gifts, donations, bequests and contracts exclusively for the abovementioned purposes with no part of the income inuring to the benefit of any member, trustee, individual, or entity. that in accordance with the abovementioned purposes, GBPI regularly imports and sells religious books such as bibles and hymns, etc.; and that GBPI likewise publishes by itself or through its printers religious books. In reply thereto, please be informed that the sale, importation, printing or publication of books and any newspaper, magazine, review or bulletin which appears at regular intervals with fixed prices for subscription and sale which is not devoted principally to the publication of paid advertisements are exempt from VAT pursuant to Section 109 (y) of the Tax Code of 1997 [then Section 103 (y) of the Tax Code, as amended by Republic Act No. 8241 and as implemented by Revenue Regulations No. 6-97]. Consequently, the importation and sale by the Gospel Bookroom of the Philippines, Inc. of religious books such as bibles, hymn books, etc. and its publication of religious books or by its printer are exempt from the 10% Value-Added Tax (VAT). 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. (VAT Ruling No. 183-88 dated June 1, 1988 and BIR Ruling No. 068-97 dated June 5, 1997). Very truly yours, Commissioner of Internal Revenue By: (SGD.) LILIAN B. HEFTI Deputy Commissioner Legal & Inspection Group