Aquaman, Inc.

March 12, 2009 BIR RULING [DA-(OSL-010) 151-09] R.A. No. 9178; BIR Ruling No. DA-129-2005 Aquaman, Inc. 45 Salvador Street Labangon, Cebu City Attention: Mr. Pat Melicor General Manager Gentlemen : This refers to your letter dated April 2, 2007, indorsed to this Office by Revenue Region No. 13, Cebu City, requesting for exemption from the payment of income tax pursuant to the provisions of Republic Act (R.A.) No. 9178. Documents show that Aquaman, Inc. is registered with the Securities and Exchange Commission (SEC) under SEC Registration No. C199800307 dated April 7, 1998. It was issued a Certificate of Authority for Barangay Micro Business Enterprise under Certificate of Registration No. 4-20-07-3 dated April 20, 2007 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 April 20, 2009. In reply, please be informed that Sections 3 (a) and 7 of R.A. No. 9178 provides, 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 asset 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. cSIADa xxx xxx xxx SEC. 7. Exemption from Taxes and Fees. All BMBE's 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 Aquaman, Inc. is a registered BMBE and was awarded BMBE Certificate of Authority by the City of Cebu, 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 April 20, 2007 or until April 20, 2009 (BIR Ruling No. DA-129-2005 dated April 6, 2005). DaIACS 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, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service