Tax Liability of an Importer of General Merchandise

January 26, 1960 BIR RULING NO. 069-60 Mr. Andres A. Leo, Jr. 1023 Instruccion Street Sampaloc, Manila S i r : Reference is made to your letter dated January 12, 1960, requesting for answer to the following cases: (a) Mr. A, an importer of general merchandise, sold his merchandise to Mr. B, an importer also, and in return Mr. B sold the same merchandise to Mr. C. What taxes will Mssrs. A, B, and C going to pay? (b) Mr. A, an importer of general merchandise sold his merchandise to Mr. B. What taxes will Messrs. A and B going to pay? In reply thereto, I have the honor to inform you as follows: (a)-1. Mr. A, an importer of general merchandise is subject to the fixed annual tax of P20.00 prescribed in section 182(A)(1) of the Tax Code. As such importer he shall pay the advance sales tax on the imported articles based on the landed costs thereof, plus the required mark-up prescribed in section 184, 185 and 186 of the same Code. He shall likewise pay the income tax on his entire net income received in the preceding taxable year, as well as the additional residence tax prescribed in section 21 of the Tax Code and section 1 of Commonwealth Act No. 465, respectively. -2. Mr. B, an importer, but deal with the goods in which the percentage tax has already been imposed, is subject only to the graduates fixed annual tax on the gross annual sales of such goods prescribed in Section 182(A)(2) of the Tax Code and subject further to the income tax on his entire net income received in the preceding taxable year, as well as the additional residence tax prescribed in section 1 of Commonwealth Act No. 465. -3. Mr. C is likewise subject to the graduated fixed annual tax and income tax prescribed in section 182(A)(2) and 21 of the Tax Code, as well as the additional residence tax prescribed in section 1 of the Commonwealth Act No. 465. (b) As regards your second query, the same is answered in No. (a)-1 and 2. cdtech Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue