Non-deduction of the Payment of Documentary Stamp Tax

February 4, 1981 BIR RULING NO. 032-81 228-00 061-80 032-81 Social Security System East Avenue, Diliman Quezon City Attention: Mr . Gilberto Teodoro Administrator Gentlemen : This refers to your letter dated December 8, 1980, requesting (1) that you be allowed to deduct from the billing of the Central Bank Security Printing Plant the amount of P518,400.00 covering the documentary stamp tax on your MICR-encoded checks for the year 1980; and (2) that you be allowed to procure the printing of your MICR-encoded checks for the year 1981 from the said Security Printing Plant without paying the documentary stamp tax thereon. In reply, please be informed that your request cannot be granted. Although under Section 16 of Republic Act No. 1161, as amended, you are exempt from the documentary stamp tax on documents required in connection with your operations, said exemption has been superseded by Section 23 of P.D. No. 1177, effective on July 30, 1977 which requires government-owned or controlled corporations to pay income taxes, customs duties and other taxes and fees as are imposed under revenue laws. (See Opinion No. 133, s. 1977, Minister of Justice.) However, under said P.D. No. 1177, you may ask for a subsidy from the General Fund in the exact amount of the documentary stamp taxes due from you. The granting of said subsidy is provided for in Finance Circular No. 2-78 dated May 9, 1978, copy enclosed. Very truly yours, RUBEN B. ANCHETA Acting Commissioner