Marikina City Legal Office

September 2, 2009 BIR RULING [DA-(DT-043) 483-09] 101 (A) (2); DA-618-2004 Marikina City Legal Office Sta. Elena, Marikina City Attention: Atty. Nancy Villanueva Teylan City Attorney Gentlemen : This refers to your letter dated August 13, 2009 requesting for a ruling that the donation made by Golden Arches Realty Corporation (GARC) of a portion of its parcel of land in favor of the City Government of Marikina is exempt from donor's tax and documentary stamp tax. CaAcSE Documents submitted show that GARC is a corporation duly recognized and existing under Philippine laws with principal address at 17th Floor, Citibank Center Bldg., Paseo de Roxas, Makati City. It is the registered owner of a parcel of land located in Marikina City with an area of 11,144 sq.m. covered by Transfer Certificate of Title (TCT) No. 432338 issued by the Registry of Deeds for the City of Marikina. A major component of the City Government's infrastructure development program is the construction of new access roads for improved mobility of people, commerce and trade. One such access road project by the City shall affect a portion of the above-mentioned property of GARC totaling an aggregate area of 966 sq.m. The City requested from GARC to donate the portion of the said property in its favor and in gesture of cooperation and goodwill, GARC agreed to donate and subsequently turned over the portion thereof to the City Government which was accepted by the latter on March 16, 1996. Subsequently, on December 13, 2005, a Deed of Donation with Acceptance was executed between GARC and the City Government of Marikina, represented by its Mayor Ma. Lourdes C. Fernando. In reply, please be informed that inasmuch as the donee is a political subdivision of the government, the above-stated donation is exempt from the payment of donor's tax pursuant to Section 101 (A) (2) of the Tax Code of 1997, as amended. Moreover, the foregoing donation will not be subject to the documentary stamp tax prescribed under Section 196 of the Tax Code of 1997, but such deed of donation shall be subject to the notarial acknowledgment of P15.00 imposed under Section 188 of the same Tax Code, as amended. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation it will be ascertained that the facts are different, then this ruling shall be considered as null and void. ESHcTD Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service