Jabez Properties Development Corporation

July 27, 2007 BIR RULING [DA-425-07] R.R. 2-98 BIR Ruling No. DA-349-04 Jabez Properties Development Corporation JSD Building No. 88 Benigno Aquino Avenue Mandurriao, Iloilo City Attention: Mr. Domingo J. Garcia Vice President/CEO Gentlemen : This refers to your letter dated January 2, 2006 requesting for a written confirmation that since Jabez Properties Development Corporation (JPDC) 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 JPDC is a corporation duly registered with the Securities and Exchange Commission (SEC) under SEC Registration No. CS200257152 issued on October 8, 2002. It is also registered with the Board of Investments as a "New Developer of Mass Housing Project" on a non-pioneer status under Certificate of Registration No. 2004-017 dated February 4, 2004. JPDC has been granted a four-year income tax holiday incentive from June 2004 or from the actual start of operations, but not earlier than its date of registration. Its project, "Happy Homes" located at Ilaya, Zarraga, Iloilo City, is registered with the Housing and Land Use Regulatory Board under Certificate of Registration No. CR-06-05-12768 issued on August 31, 2005. 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. SHECcD Accordingly, since JPDC 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 2004, 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. 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