Southeast Asian Regional Center For Graduate Study and Research in Agriculture

October 10, 2008 BIR RULING [DA-(FIT-010) 285-08] 27 (D); DA-588-2007 Southeast Asian Regional Center For Graduate Study and Research in Agriculture Los Baos, Laguna Attention: Mr. Gil C. Saguiguit, Jr. Deputy Director - Administration Gentlemen : This refers to your letter dated September 3, 2008 requesting this Office to issue a certificate of tax exemption from payment of 20% final tax on interest earnings derived from savings and time deposits, treasury bonds, treasury bills and other bank notes in favor of the Southeast Asian Ministers of Education Organization Regional Center for Graduate Study and Research in Agriculture (SEAMEO SEARCA). ACHEaI It is represented that SEAMEO SEARCA is a non-stock, non-profit educational institution located at Los Baos, Laguna; that it was established through an enabling instrument in accordance with the Charter of the Southeast Asian Ministers of Education Organization formed by the Ministers of Education in the Philippines, Indonesia, Malaysia, Lao PDR, Singapore and Thailand in order to provide high quality graduate education and training in agriculture in the region; that SEAMEO SEARCA is both an international and educational institution at the same time, hence qualified to be exempt from the 20% final tax. In reply, please be informed that rulings issued by this Office are still valid and in effect until revoked. Inasmuch as there is no ruling revoking BIR Ruling No. DA-313-2005, the same is still in effect. Thus, SEARCA is exempt from payment of the 20% final tax on interest earnings derived from treasury bonds, treasury bills and other bank notes. Savings and time deposits, treasury bills, treasury bonds and other bank notes of SEARCA also form part of its assets used for educational purposes. As such, they are exempt from tax by virtue of the proviso of Section 4 (3) of Article XIV of the 1987 Constitution which reads: "(3) All revenues and assets of non-stock, non-profit educational institutions used actually, directly and exclusively for educational purposes shall be exempt from taxes and duties. Upon the dissolution or cessation of the corporate existence of such institutions, their assets shall be disposed of in the manner provided by law." This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it shall 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