BIR Ruling No. 031-82

February 8, 1982 BIR RULING NO. 031-82 205-A 000-00 031-82 The Manila Hotel Rizal Park, Manila Attention: Mr . Domingo S . Galicia Credit Manager Gentlemen : This refers to your letter dated October 8, 1981 stating that the Philippine Institute For Development Studies (PIDS) is contemplating to avail of your hotel, restaurant and banquet facilities in connection with its coming conference on December 8 and 9, 1981; and that on the basis of the letter of this Bureau dated January 8, 1981 exempting said Institute from the payment of all taxes, one of its organizers, Mr. Isaac S. Puno III is requesting that the institute be exempt from the 10% tax on room accommodation, 3% tax on food and the 7% tax on hard drinks which you normally include in the bills of your customers. cdtech Under the foregoing facts, you would like to inquire if the tax exemption privilege granted to PIDS is likewise applicable to hotel and restaurant establishments. In reply, I have the honor to inform you that PIDS is exempt from any and all taxes, direct or indirect , imposed only by the Republic of the Philippines, or any of its political subdivisions. (Sec. 11, P.D. No. 1201) Although, as proprietor of the hotel and restaurant, you are directly liable for payment of the 10% hotel room occupancy tax, the 3% tax on food as well as the 7% tax on distilled spirit, fermented liquors and wines imposed by Sections 205-A and 206 of the Tax Code, the billing of said taxes to PIDS would make the latter indirectly liable for the payment thereof. Under the aforesaid Decree, PIDS is exempt from indirect taxes, i.e. those taxes which PIDS shall be indirectly liable. In other words, you may bill PIDS without including therein the aforesaid percentage taxes imposed by Sections 205-A and 206 of the Tax Code. In such case, you are exempt from paying the percentage taxes due on the receipts derived from PIDS. Very truly yours, RUBEN B. ANCHETA Acting Commissioner