Saint Francis of Assisi Publications

February 5, 2009 BIR RULING [DA-(VAT-013) 054-09] Section 109 (R); DA-149-2007 Saint Francis of Assisi Publications 952 Josefina, 3rd Street, Sampaloc, Manila Attention: Engr. Renato V. Mariano Publisher/Manager Gentlemen : This refers to your undated letter requesting for a VAT exemption certificate as required by the Department of Education pursuant to Section 109 (R) of the Tax Code of 1997, as amended. TacSAE As represented, Saint Francis of Assisi Publications is engaged in publishing books for pre-school and elementary; and that it is registered with the Bureau of Internal Revenue as a VAT exempt entity. In reply, please be informed that Section 109 (R) of the 1997 Tax Code, as amended by R.A. 9337, provides: "Sec. 109. Exempt Transactions . (1) Subject to the provisions of Subsection (2) hereof, the following transactions 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, Saint Francis of Assisi Publications is exempt from VAT on its sale of books and magazines. (see BIR Ruling No. DA-667-2004 dated December 28, 2004) On the other hand, Saint Francis of Assisi Publications is not exempt from the VAT that is passed on to it in its purchases of materials in furtherance of its business. As a final purchaser, Saint Francis of Assisi Publications pays the VAT not as a tax but as part of the cost of the goods/materials it purchased from the seller/supplier. 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. CADSHI Very truly yours, Commissioner of Internal Revenue By: (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service