Method of Reporting Receipts for Purposes of the 3% Publisher's Tax

June 2, 1969 BIR RULING NO. 009-69 Mutual Books, Inc. 465-A Mabini cor, Shaw Blvd. Mandaluyong, Rizal Attention : Mr . Francisco F . Gonzales IV Treasurer Gentlemen : This refers to your letter dated January 30, 1969 stating the following: cdll "Mutual Books, Inc. a domestic corporation is engaged in publishing as defined under Sec. 191 of the National Internal Revenue Code. It keeps its books on the accrual basis. It has consistently paid the 3% percentage tax on the basis of its monthly sales (cash and charge). As the business is seasonal there are months where total sales (cash and charge exceed the collections as well as months where the collections exceed the total sales. "Query : Will the company be liable for deficiency tax during the months where the collections exceed the total sales (cash or charge)?" In reply, I have the honor to inform you that your method of reporting receipts for purposes of the 3% publisher's tax under Section 191 of the Tax Code is erroneous. The 3% tax prescribed by Section 191 of the Tax Code is based on the actual receipts of the publisher. Accounts which remained uncollected at the end of the month should not be declared for taxation during the said month for purposes of the percentage tax. Said amounts should be returned for taxation and the tax due thereon paid during the month in which they are actually collected. It appears, however, that you have declared your receipts for purposes of the 3% contractor's tax on; the accrual basis. Since you have already paid the tax on charged accounts, the subsequent collection thereof is no longer subject to tax. Your inquiry is, therefore, answered in the negative. While, as a rule, the 3% tax is based on actual receipts, there is no liabilities against paying the tax on the basis of accrued receipts. You may, therefore, continue paying the tax on the basis of accrued receipts if you find it more convenient for you. LibLex Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue