Request for Authority to Apply Tax Credit Certificate to the Payment of Withholding Tax Liabilities

April 3, 1997 BIR RULING NO. 037-97 204 000-00 037-97 Joaquin Cunanan & Co. 8th Floor, BA-Lepanto Bldg. 8747 Paseo de Roxas Makati City Attention: Mr . George J . Lavadia Principal Gentlemen : This refers to your letter dated April 10, 1996 requesting for an authority, in behalf of your client, United Technologies Automotive, Phils., Inc. (UTAPI), to apply its Tax Credit Certificate (TCC) No. 2212 issued on December 13, 1994, to the payment of its withholding tax liabilities. It is represented that your client, United Technologies Automotive, Phils., Inc. (UTAPI), is a company registered with the Mactan Export Processing Zone; that as an exporter, it secured the said TCC (instead of cash) as refund of its unused input taxes pursuant to Section 106 (a) of the Tax Code. In reply we regret to inform you that your request cannot be granted for lack of legal basis. Withholding tax is the liability of the recipient of the income payment and as such it cannot be applied to the withholding tax liability of the holder. (VAT Ruling No. 123-90 dated May 14, 1990) aisadc Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue