BIR Ruling [DA-549-06]

September 14, 2006 BIR RULING [DA-549-06] Sec. 148 (a); 107 (A); DA-482-06; DA-483-06 BVM Sanchez & Son Customs Broker and Freight Forwarding Co., Inc . Suite 207 O. Ledesma Building Gen. Luna corner Real Street Intramuros, Manila Attention: Ms. Bernardina M. Sanchez Gentlemen : This refers to your letter dated August 10, 2006 requesting in behalf of your client, Legaspi Import and Export Company, Inc. (LIEC for brevity), a ruling exempting its importation of "Low Aromatic White Spirit" or LAWS from the payment of excise tax imposed under Section 148(a) of the Tax Code of 1997, as amended. It is represented that the article LAWS is used as a chemical in the manufacturing of paint and rubber products, special coatings household products, pesticides and wood treatment formulation, printing inks for papers, textiles and adhesives; and that the Chief of BIR Laboratory Section, Ms. Cleotilde M. Jose, issued a Memorandum dated September 5, 2006, stating as follows: ". . . LAWS is an intermediate or an organic compound derived from coal tar or petroleum products. It is used as solvents in the coating field such as paints, varnishes and lacquers, industrial cleaners, printing inks, pesticides and wood treatment formulations. . . . LAWS is not among the articles subject to excise tax under Section 148(a) of the Tax Code of 1997, as amended. " (Emphasis supplied) Based on the foregoing, this Office hereby holds that the importation by LIEC of LAWS is not subject to excise tax imposed under Section 148(a) of the Tax Code of 1997, as amended. However, said importation is subject to the value-added tax imposed under Section 107(A) of the Tax Code of 1997, as amended. (BIR Ruling Nos. DA-482-06 & DA-483-06, both dated August 9, 2006, citing BIR Ruling No. 128-98 dated September 10, 1998) cADaIH 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