Freight Receipts Derived by a Domestic Corporation from Incoming Cargoes Not Subject to 1% Expanded Withholding Tax

January 17, 1994 BIR RULING NO. 025-94 50 (b) 108-86 025-94 King Capuchino Tan & Associates 2nd Floor, Belman II Building Quezon Ave. cor. Cordillera St. Quezon City Attention: Atty . Lincoln L . Tan Jr . Gentlemen : This refers to your letter dated September 9, 1993 requesting in behalf of your client, Loadstar International Shipping, Inc. (LISI), a domestic corporation, confirmation of your opinion that LISI's freight receipts derived from incoming cargoes are not subject to the expanded withholding tax of 1% imposed by Section 1 (e)(2)(e) of Revenue Regulations No. 6-85 in relation to Section 50(b) of the Tax Code, pursuant to BIR Ruling No. 50-f-000-77-108-86 dated July 11, 1986. In reply thereto, please be informed that this Office has ruled that our withholding tax law is not applicable and effective abroad. Such being the case, freight receipts derived by you from incoming cargoes are not subject to the expanded withholding tax of 1% pursuant to Section 1(e)(2)(e) of Revenue Regulations No. 6-85, as amended, implementing Section 50 (b) of the Tax Code, as amended. cdt Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue