Applicability of the Withholding Provisions of RA No. 1051

February 10, 1960 BIR RULING NO. 049-60 The Chief Accountant Bureau of Mines M a n i l a S i r : In connection with your letter dated January 22, 1960, requesting whether the withholding provisions of Republic Act No. 1051 are applicable to the transaction mentioned therein, and if so, to furnish you with the computation of the tax to be withheld therefrom, I have the honor to inform you that pursuant to Republic Act No. 1051, as implemented by Revenue Regulations No. V-40, the internal revenue taxes that can be withheld are those which can be fixed, determined, computed or ascertained at the time of payment. The deductions and withholdings on the money payments on account of transactions made with any bureau, office, agency or instrumentality of the government shall not, however, be required in case previous payments of said tax liability or liabilities had already been made by the corresponding payee. It appearing that the payee is a manufacturer, whose tax liability cannot be determined, fixed or computed at the time of payment until the cost of raw materials used in the manufactured article had been properly deducted, no tax need be withheld from it. casia Very truly yours, MISAEL P. VERA Deputy Commissioner of Internal Revenue