Sale of Crude Soya Bean Oil and Soya Bean Meal Exempt from Value-Added Tax

May 15, 1997 BIR RULING NO. 056-97 103 (d) 000-00 056-97 General Milling Corporation 6th Floor Corinthian Plaza 121 Paseo de Roxas Makati City Gentlemen : This refers to your letter dated December 6, 1996 requesting for a ruling that your sale of crude soya bean oil and soya bean meal is exempt from value-added tax. It is represented that you are engaged, among others, in the milling of soybeans which produces soya bean meal as a main product and crude soya bean oil as a by-product and that both products are sold to RFM Corporation and Vitarich Corporation and used by the latter as ingredients for animal feeds. It is noted that the Bureau of Animal Industry has issued a certification dated November 12, 1996 to the effect that crude soya oil and soya bean meal are by-products of soya beam meal extraction and are considered essential ingredients in the manufacture of livestock and poultry feeds. In reply, please be informed that pursuant to Section 103 (d) of the Tax Code, as amended by R.A. No. 7716, the sale or importation of poultry feeds, among others, including ingredients, whether locally produced or imported, which are used in the manufacture of finished feeds (except specialty feeds for race horses, fighting cocks, aquarium fish, zoo animals and other animals generally considered as pets) are exempt from value-added tax. Since the Chief, Animal Feeds Standard Division, Bureau of Animal Industry has certified that crude soya bean oil and soya bean meal are indeed essential ingredients in the manufacture of livestock and poultry feeds the sale thereof to RFM Corporation and Vitarich Corporation are exempt from the 10% value added tax. aisadc Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue