World News Publication Corporation

January 13, 2009 BIR RULING [DA-(VAT-002) 008-09] Section 109 (y); DA-534-2006 World News Publication Corporation 578 Tomas Pinpin Street Binondo, Manila Attention: Mr. Florencio Mallare President Gentlemen : This refers to your letter dated September 8, 2008, requesting for a ruling that World News Publication Corporation is exempt from value-added tax. aATESD As represented, World News Publication Corporation is a domestic corporation engaged in the publication of Chinese newspaper; and that you attached your BIR Certificate of Registration. In reply, please be informed that Section 109 (R) [then Section 109 (y)] of the Tax Code of 1997 as amended by Republic Act (RA) No. 9337 provides, viz. : "SEC. 109. Exempt Transactions . The following shall be exempt from the value-added tax: xxx xxx xxx (R) Sale, importation, printing or publication of books and any newspaper, magazine, review or bulletin which appears at regular intervals with fixed prices for subscription and sale and which is not devoted principally to the publication of paid advertisements . . . ." Accordingly, World News Publication Corporation is exempt from the 12% value-added tax on its sale, importation, printing or publication of newspapers. In VAT Ruling No. 037-2001 dated June 13, 2001, this Office had the occasion to rule that the 3% percentage tax prescribed under Section 116 of the Tax Code of 1997 does not apply to transactions exempt from the 10% (now 12%) VAT listed in Section 109 (A) to (V) of the same Code as it applies only to transactions falling under item (V) of the said section. However, if you have other transactions (such as printing of brochures) which are subject to the VAT and your gross annual sales and/or receipts exceed the amount of P1,500,000.00, you will be required to register your business as a VAT business entity and issue a separate VAT invoice/receipt to record such transactions (Revenue Memorandum Circular No. 62-2005). This ruling is being issued on the basis of the foregoing facts as represented. If upon investigation, it will be discovered that the facts are different, then this ruling shall be considered null and void. cACEaI Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service