Taxability of the Business of Supplying Fresh Water
BIR Ruling No. 017-88 • Bureau of Internal Revenue (BIR) Issuances • Rulings (Numbered) • Feb 1, 1988
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February 1, 1988 BIR RULING NO. 017-88 103 (b) 000-00 017-88 Gentlemen : This refers to your letter dated January 6, 1988 stating that your company, which commenced operation on February 1, 1987, is engaged in the business of supplying fresh water to inter-island and ocean-going vessels; that you buy fresh water from the MWSS and draw the water through your own pipelines at the North Harbor and into your barges; and that these barges respond to orders and pump out the water to the customer's vessels at anchor offshore or at pierside. Based on the foregoing facts you request for a ruling on the taxability of your business. In reply, please be informed that fresh water comes within the purview of agricultural food products; hence, the sale thereof in all stages of distribution is exempt from the value-added tax pursuant to Section 103(b) of the Tax Code, as amended by Executive Order No. 273. Very truly yours, (SGD.) EUFRACIO D. SANTOS Deputy Commissioner
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