BIR Ruling No. 012-64

March 9, 1964 BIR RULING NO. 012-64 2nd Indorsement Returned to the Regional Director, Regional District No. 1, Baguio City, the papers bearing on the withholding tax case of Mrs. ADELAIDA C. ESPINA of that City, with the following information: The record discloses that spouses Jaime Espina and Adelaida Espina are both employees of the City Engineer's Office of Baguio City. Mr. Espina is employed as an Auditing Examiner of the Bureau of Public Highways and draws his salary from the Highway Maintenance Fund which is paid by the Disbursing Officer of the City Engineer's Office. On the other hand, Mrs. Espina is employed as a Supervising Clerk in the same City Engineer's Office but her salary is charged against the city fund and paid by the Paymaster of the City Treasurer's Office. Mrs. Espina claims that her salary is exempt from withholding tax because their total exemptions exceed their joint income and that, in accordance with BIR Ruling No. 216, series of 1960, the tax to be withheld shall be determined on their aggregate income and that they shall be given the full benefit of the personal and additional exemption which, otherwise, would have been allowable only to the husband. The question to be resolved in this case is whether or not, under the facts stated above, the salary of Mrs. Espina is subject to the withholding tax. Article 2(g), Supplement A to Title II of the National Internal Revenue Code provides: aisadc "When a husband and wife each are recipients of wages, whether from the same or different employers, taxes to be withheld shall be determined on the following bases: (1) The husband shall be deemed the head of the family and proper claimant of the additional exemption in respect to any dependent children; (2) Taxes shall be withheld from the wages of the wife in accordance with the schedule for zero exemption of the withholding tax taxable in sub-article (a)." In the light of the above provision of law, the tax has to be withheld from the salary of Mrs. Espina regardless of the fact that both her husband and herself are recipients of wages from the same employer and that their total exemptions exceed their joint income. The rulings referred to (BIR Ruling dated Dec. 18, 1956 and BIR Ruling No. 216, series of 1960) cannot be applied to the instant case because the consideration therefor which is "payment by the same disbursing officer" does not obtain therein. (SGD.) BENJAMIN N. TABIOS Acting Commissioner of Internal Revenue