Taxability of Clothes and Textiles Intended for Clothing

March 2, 1987 BIR RULING NO. 062-87 163 (2) (g) 000-00 062-87 Gentlemen : In reply to your letters dated September 19, 1986 and January 22, 1987, please be informed that inasmuch as clothes and textiles intended for clothing are classified as essential articles taxable at the rate of 10%, the garters, soutaches trimmings, cords, rick racks, fringes ribbon tapes and other related products which you manufacture and are being used by garment manufacturers are also subject to the same rate of sales tax, i.e., 10% under Section 163(2)(g) of the Tax Code as amended by Executive Order No. 36, provided that the purchasers thereof shall certify to you that the same shall be used exclusively in the manufacture of clothes and textiles intended for clothing. (Section 163(2), Tax Code, Section 6.II, Revenue Regulations No. 11-86 dated July 31, 1986). If the purchasers fail to issue the certification, you will be subject to 20% sales tax pursuant to Section 163(4) of the Tax Code as amended. With respect to query No. 2, please be informed that under Section 3 of Revenue Regulations No. 19-84 dated October 12, 1984, any person who is not a manufacturer , who supplies raw materials, part, accessory, or other article and packaging materials to manufacturer for conversion into or intended to form part of the finished product and who desires his separately billed sales tax availed of by his customer-manufacturer as tax credit shall register with the appropriate Revenue District Officer for accreditation as a dealer-supplier of the said articles. Accordingly, since you are a manufacturer, you are not required to register with our Revenue District Officer for accreditation under said Revenue Regulations No. 19-84. (BIR Ruling No. 100-85 dated June 25, 1985) Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner