Catarman Oil Mills, Inc.

November 11, 2008 BIR RULING [DA-(IL-042) 416-08] DA101-06 Catarman Oil Mills, Inc. Sitio Torotangbo Barangay Aguadahan San Jose, Northern Samar Attention: Ms. Clarabell Sio Dy Corporate Secretary Gentlemen : This refers to your letter dated July 10, 2008 stating that your company, Catarman Oil Mills, Inc., is a corporation duly organized and existing under the laws of the Philippines; that it is likewise registered with the Board of Investments (BOI) under Certificate of Registration No. 2008-116 dated June 3, 2008 as a New Producer of Coconut Oil and its by-products (Copra Cake) on a Non-Pioneer Status under Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987; and that it is entitled to an income tax holiday (ITH) of four (4) years. Based on the foregoing representations, you now request for exemption from the payment of withholding tax pursuant to Section 2.57.5 (B) (2) of Revenue Regulations No. 2-98, as amended. In reply thereto, please be informed that Section 2.57.5 of Revenue Regulations No. 2-98, as amended, provides: "SEC. 2.57.5. Exemption from Withholding. The withholding of creditable withholding tax prescribed in these Regulations shall not apply to income payments made to the following: (B) Persons enjoying exemption from payment of income taxes pursuant to the provisions of any law, general or special, such as but not limited to the following: xxx xxx xxx (2) Corporations registered with the Board of Investments and enjoying exemption from the income tax provided by Republic Act No. 7916 and the Omnibus Investment Code of 1987; ISEHTa SUCH BEING THE CASE, this Office holds that payments made by your customers are not subject to the creditable withholding tax pursuant to Section 2.57.5 of Revenue Regulations No. 2-98. 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 null and void. Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service