Mindease Business Solutions, Inc.

April 13, 2010 BIR RULING [DA-(OSL-004) 047-10] R.A. No. 9178 & RMC 40-04; BIR Ruling Nos. DA-356-04, DA-129-05, DA-17-08, DA-083-08 & DA-327-08 Mindease Business Solutions, Inc. 1152 E. Rodriguez Sr. Avenue Quezon City Attention: Ms. Mary Jane Yu Tan Treasurer Gentlemen : This refers to your letter dated January 15, 2010 requesting exemption from the payment of income tax pursuant to the provisions of Republic Act (R.A.) No. 9178. Documents show that Mindease Business Solutions, Inc. was issued a Certificate of Authority for Barangay Micro Business Enterprise under Certificate of Registration No. 09-002 dated May 22, 2009 pursuant to Republic Act No. 9178, otherwise known as "An Act to Promote the Establishment of Barangay Micro Business Enterprise, Providing Incentives and Benefits Therefor, and for Other Purposes," entitling it to all benefits and incentives subject to the terms and conditions set forth in the said law, which will expire on May 22, 2011. It is also registered with the Securities and Exchange Commission (SEC) under SEC Registration No. CS200707047 dated May 8, 2007. In reply, please be informed that Sections 3 (a) and 7 of R.A. No. 9178 provide, viz.: "SEC. 3. Definition of Terms. As used in the Act, the following terms shall mean: (a) "Barangay Micro Business Enterprise," hereinafter referred to as BMBE, refers to any business entity or enterprises engaged in the production, processing or manufacturing of products or commodities, including agro-processing, trading and services, whose total assets including those arising from loans but exclusive of the land on which the particular business entity's office, plant and equipment are situated, shall not be more than Three Million Pesos (P3,000,000.00) subject to review and upward adjustment by the SMED Council, as mandated under Republic Act No. 6977, as amended by Republic Act No. 8289. CAacTH xxx xxx xxx SEC. 7. Exemption from Taxes and Fees. All BMBEs shall be exempt from income tax for income arising from the operations of the enterprise. The LGUs are encouraged either to reduce the amount of local taxes, fees and charges imposed or to exempt the BMBEs from local taxes, fees and charges." Inasmuch as Mindease Business Solutions, Inc. is a registered BMBE and was awarded BMBE Certificate of Authority by the City of Quezon, it is therefore exempt from the payment of income tax for income arising from the operations of the enterprise for a period of two (2) years from May 22, 2009 or until May 22, 2011. 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.) GREGORIO V. CABANTAC Deputy Commissioner Legal and Inspection Group