Primex Coco Products, Inc.

August 22, 2008 BIR RULING [DA-(IL-017) 170-08] E.O. 226; DA-456-07 Primex Coco Products, Inc. Bo. Mangilag, Candelaria Quezon Province Attention: Mr. Darius Oliver Sio Director Gentlemen : This refers to your letter dated April 4, 2008 requesting for a ruling on the tax consequence of the Income Tax Holiday (ITH) granted to Primex Coco Products, Inc. (Primex) by the Board of Investments (BOI) under Executive Order (E.O.) No. 226 otherwise known as the Omnibus Investments Code of 1987. SATDHE It is represented that Primex Coco Products, Inc. is a corporation duly organized and existing under the laws of the Republic of the Philippines with plant address at Bo. Mangilar, Candelaria, Quezon; that Primex is registered with the Board of Investments (BOI) as New Export Producer of Coconut Milk Powder in a Non-Pioneer Status under the Omnibus Investments Code of 1987; and that it is entitled to Income Tax Holiday (ITH) for four (4) years. In reply, please be informed that under Section 2.57.5 (B) (2) of Revenue Regulations No. 2-98, implementing Section 57 (B) of the Tax Code of 1997, 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. (BIR Ruling No. DA-072-98 dated March 11, 1998) DSEIcT Accordingly, since Primex 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 4 years, this Office is of the opinion, as it hereby holds, that it is exempt from the payment of the creditable withholding tax imposed under Revenue Regulations No. 2-98, on income payments received by it during the aforementioned period with respect to its registered activity, subject however to the condition that both the BOI General and Specific Terms and Conditions for the grant of ITH are met during the said period. 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. THADEI Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service