Whether the Cultural Center of the Philippines (CCP) is Exempt from Withholding Provisions of P.D. No. 1959

March 7, 1986 BIR RULING NO. 021-86 24 (cc) 000-00 021-86 Gentlemen : This refers to your letter dated December 11, 1984 requesting a ruling as to whether or not the Cultural Center of the Philippines (CCP) is exempt from withholding provisions of P.D. No. 1959 as implemented by Revenue Regulations No. 17-84. It appears that under Section 13 of P.D. No. 15 as amended by P.D. Nos. 1444 and 1815, the CCP is exempt from all forms of taxation, whatever including withholding taxes on fees paid to foreign artists passed on to the Center by contract , and from duties and all other imposts an any equipment, articles, goods and services that it may import from abroad which may be reasonably necessary for use in or part of its operations, but that said exemption shall not apply to business ventures of the Center ; that P.D. No. 1825, effective January 16, 1981, further amended P.D. No. 1815, such that the business ventures of the CCP shall be subject to all taxes, which, except for income tax, shall, in lieu of being paid directly to the Bureau of Internal Revenue, be paid directly to the CCP, such fund to be used by the center for its cultural activities; that under P.D. No. 1931, effective June 11, 1984, all exemptions from payment of duties, taxes, fees, imposts and other charges granted in favor of government-owned or controlled corporations, including their subsidiaries, have been withdrawn; and that under Section 1 of Letter of Instructions (LOI) No. 1437 issued on October 30, 1984, the CCP is exempted from the provisions of P.D. No. 1931; thus, the duty and tax exemption privileges of the CCP under P.D. No. 15 as amended is maintained. However, the business operations of the CCP shall remain liable for all taxes. In reply, please be informed that since CCP's exemption from all forms of taxation whatever under P.D. No. 15 is maintained by express provision of LOI 1437 which is a law promulgated later than P.D. 1959 (effective October 15, 1984), CCP is exempt from the 15% final withholding tax on interest income from Philippine currency bank deposits and yield from deposit substitutes prescribed by Section 24(cc) of the Tax Code, as amended by P.D. No. 1959 as implemented by Revenue Regulations No. 17-84. Such being the case, the 15% final tax withheld beginning October 30, 1984 from interest income earned by the CCP from its investments in treasury bills purchased thru CB-accredited banking institutions, and remitted to the Bureau of Internal Revenue may be refunded. For this purpose, CCP should file a claim for refund with this Office, Attn.: Chief, Appellate Division, within two (2) years from date of payment pursuant to Section 295 of the Tax Code as amended. In is understood, however, that this tax-exemption does not apply to income of CCP from similar investments in connection with its business operations such as Philippine Plaza Hotel. Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner