Sale by SSS of a Parcel of Land Exempt from All Kinds of Taxes, Including Capital Gains and Documentary Stamp Taxes

April 13, 1998 BIR RULING NO. 042-98 R.A. 8282-000-00-42-98 Mr. Everendo B. Medina B1, L8, SSS Housing North Fairview, Quezon City Gentlemen : This refers to your letter dated July 3, 1997 requesting for the exemption of Social Security Systems (SSS) from the payment of the capital gains tax on the sale of its parcel of land to you, situated in the District of North Fairview, Quezon City and covered by Transfer Certificate of Title No. 60205 issued by the Register of Deeds of Quezon City. dctai In reply, please be informed that Section 16 of Republic Act No. 8282 states that: "Sec. 16. Exemption from Tax , Legal Process and Lien . All laws to the contrary notwithstanding, the SSS and all its assets and properties, all contributions collected and all accruals thereto and income or investment earnings therefrom, as well as all supplies, equipment, papers or documents shall be exempt from any tax , assessment , fee , charge , or customs or import duty and all benefit payments made by the SSS shall likewise be exempt from all kinds of taxes, fees or charges and shall not be liable to attachments, garnishments, levy or seizure by or under any legal or equitable process whatsoever, either before or after receipt by the person or persons entitled thereto, except to pay any debt of the member to the SSS. No tax measure of whatever nature enacted shall apply to the SSS, unless it expressly revokes the declared policy of the State in Section 2 hereof granting tax-exemption to the SSS. Any tax assessment imposed against the SSS shall be null and void." (emphasis supplied) In view thereof, the sale of SSS of a parcel of land to you shall be exempt from all kinds of taxes, including capital gains and documentary stamp taxes, pursuant to the afore-quoted Sec. 16 of R.A. 8282. However, since SSS is exempt from the documentary stamp tax imposed under Title VII of the Tax Code, as amended, you, being the other party to the taxable document who is not exempt, shall be the one directly liable to the said documentary stamp tax. Very truly yours, (SGD.) LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue