Yakult Philippines Incorporated

September 15, 2008 BIR RULING [DA-(C-065) 217-08] Sections 204, 248, 249; 047-00, 119-98 Yakult Philippines Incorporated National Highway, Barangay Makiling Calamba City, Laguna Attention: Atty. Rufino D. Eslao, Jr. In-house Counsel Gentlemen : This refers to your letter dated June 16, 2008 requesting for waiver of that portion of the tax liability representing the surcharges for paying taxes at the wrong venue. It is represented that Yakult Philippines Incorporated (Yakult) purchased all issued and paid shares of stocks of stockholders of Biomate Corporation (Biomate), a domestic corporation duly organized and created by virtue of and under the laws of the Republic of the Philippines with principal office address located in Baguio City; that the stockholders of Biomate are residents of San Juan, Quezon City and Manila; that Yakult in good faith and in all honesty filed all pertinent documents in BIR Baguio thinking that since Biomate has its principal office in Baguio City then it is the proper venue for paying the required taxes; that Yakult was assessed by the examiner of BIR Baguio and was given the proper documents to pay the corresponding taxes in an accredited bank within the jurisdiction of BIR Baguio; that the taxes were paid on time; that the Revenue District Officer of Baguio City refused to issue the corresponding Certificate Authorizing Registration (CAR) since the proper venue for payment of the taxes should follow where the taxpayers are registered as such; and that Yakult was assessed by the corresponding RDO a penalty of 25% of the tax paid for filing at the wrong venue. In reply, please be informed that Revenue Memorandum Order No. 66-99 provides that sale or transfer of shares of stock shall be processed with the RDO where the seller/transferor is registered. Such being the case, the taxes on the said sale transaction should be remitted/paid at the RDO of San Juan, Quezon City and Manila where the sellers/transferors are registered or required to be registered which shall also issue, after all taxes on the said sale transaction has been verified to have been paid, the corresponding CAR on the said sale transaction. In view of the justifiable circumstance surrounding your case, this Office hereby waives the 25% surcharge being proposed to be assessed against the sellers/transferors for paying the tax at the wrong venue due to the fact that Yakult was made to believe by RDO No. 8 that it had jurisdiction to receive said payment and issue the corresponding CAR thereon. This shall serve as an authority for RDO No. 8, Baguio City, to transfer whatever payment Yakult made on the said sale transaction to the RDOs where the seller-taxpayers are registered. EaSCAH 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