Publisher's Tax on the Activities of Philippine Bible House

February 22, 1960 BIR RULING NO. 060-60 The Philippine Bible House P. O. Box 755, Manila Gentlemen : Reference is made to your letter dated February 8, 1960, as supplemented by that dated February 18, 1960, requesting opinion whether or not that House is subject to the 3% publisher's tax on its activities of translating, publishing, distributing, and promoting the use of the Holy Scriptures. Opinion is also requested whether or not the importation of printing paper for use in connection with said activities is subject to the compensating tax. In answer thereto, I have the honor to inform you that, in line with the doctrine enunciated in the case of American Bible Society vs. City of Manila (G.R. No. L-9637, April 30, 1957), the activities in question are not subject to the 3% publisher's tax imposed in section 191 of the National Internal Revenue Code. In said case, the Supreme Court held that to tax the distribution and sale by the plaintiff of bibles and/or gospel portions thereof would be to impair its right to the free exercise and enjoyment of its religious profession and worship, which right including that of disseminating religious beliefs. Neither is that House, for conducting those activities, subject to any other business tax, provided that such activities are undertaken by it in connection exclusively with its religious activities; that is, it does not accept jobs for translating, publishing, distributing, or promoting the use of the Holy Scriptures, or any other material, from third parties. On the other hand, considering that the prohibition to tax is limited to the right of free exercise and enjoyment of religious profession and worship and considering further that the imposition of the compensating tax upon importations of religious organizations for use in connection with their religious activities would not amount to taxing said right, it being a tax on the use of property, this Office is of the opinion and so holds that the printing paper imported by the House is subject to 7% compensating tax, pursuant to section 190, in relation to section 186 of the Tax Code. "We do not mean to say that religious groups and the press are free from all financial burdens of government. . . . We have here something quite different, for example, from a tax on the income of one who engages in religious activities or a tax on property used or employed in connection with those activities . It is one thing to impose a tax on the income or property of a preacher . It is quite another thing to exact a tax from him for the privilege of delivering a sermon . The tax imposed by the City of Jeansette is a flat license tax, the payment of which is a condition of the exercise of these constitutional privileges. The power to tax the exercise of a privilege is the power to control or suppress its enjoyment. . . .". (Murdock vs. Bible Society vs. City of Manila, supra; emphasis supplied) lexlib Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue