Firm Builders Realty Development Corporation

October 17, 2008 BIR RULING [DA-(IL-029) 313-08] RR 2-98; BIR Ruling No. DA-349-04 Firm Builders Realty Development Corporation Door 6 & 7 Sheridan Bldg., Calamansi Drive Carmen, Cagayan de Oro City Attention: Engr. Noel V. Vergara Project Manager Gentlemen : This refers to your request, indorsed to this Office by Revenue Region No. 98, Cagayan de Oro City, for exemption from expanded withholding tax imposed under Revenue Regulations (RR) No. 2-98, as amended, in view of Firm Builders Realty Development Corporation's ("FBRDC" for brevity) entitlement to Income Tax Holiday on account of its registration with the Board of Investments (BOI) under Executive Order No. 226, otherwise known as the "Omnibus Investments Code of 1987". Documents show that FBRDC is a corporation duly registered with the Securities and Exchange Commission (SEC) under SEC Registration No. ASO92-003148 issued on May 18, 1992. It is also registered with the Board of Investments as a "New Developer of Mass Housing Project" on a non-pioneer status under Certificate of Registration No. 2007-017 dated February 6, 2007. FBRDC has been granted a four-year income tax holiday incentive from date of registration or February 6, 2007. Its project, "Silver Creek-Cagayan de Oro City" located at Carmen, Cagayan de Oro City, is registered with the Housing and Land Use Regulatory Board under Certificates of Registration No. 12702, 12703 and 12704, all issued on July 3, 2006. In reply, please be informed that under Section 2.57.5 (B) (2) of RR No. 2-98, as amended, implementing Section 57 (B) of the Tax Code of 1997, as amended, 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. AaCEDS Accordingly, since FBRDC 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 four (4) years reckoned from February 6, 2007, this Office is of the opinion as it hereby holds, that it is exempt from the payment of the creditable withholding tax imposed under RR No. 2-98, as amended, on income payments received by it during the aforementioned period with respect to its registered activity. 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