BIR Ruling No. 080-12

February 15, 2012 BIR RULING NO. 080-12 Section 24 (D) of the National Internal Revenue Code of 1997, as amended; 000-00 Hongkong Land Development and Investments Corporation Unit 5-B Armada Building, College Street Sto. Rosario-Kanluran, Pateros, Metro Manila Attention: Engr. William C. Que Pres./Gen. Manager Gentlemen : This refers to your letter dated June 22, 2011 requesting that the Deed of Assignment you entered into as owner of a parcel of land in favor of your company, Hongkong Land Development & Investments Corporation, be exempt from Capital Gains Tax. SHEIDC It is represented that Engr. William C. Que is the owner of a parcel of land situated in Pateros, Metro Manila, covered by TCT No. 766. A Deed of Assignment over the aforementioned parcel of land was entered into by Engr. William C. Que (Assignor) and Hongkong Land Development and Investments Corporation (Assignee) . In reply, please be informed that Section 24 (D) of the National Internal Revenue Code of 1997, as amended, states: "(D) Capital Gains from Sale of Real Property (1) In General The provisions of Section 39(B) notwithstanding, a final tax of six percent (6%) based on the gross selling price or current fair market value as determined in accordance with Section 6(E) of this Code, whichever is higher, is hereby imposed upon capital gains presumed to have been realized from the sale, exchange, or other disposition of real property located in the Philippines ..." (emphasis supplied) In the case of Visayan Cebu Terminal Co., Inc. vs. Commissioner of Internal Revenue ,L-19530 & L-19444, the Supreme Court held that it is a well settled rule that he who claims exemption should prove by convincing proof that he is exempted. In view of the foregoing Supreme Court decision, this Office hereby denies your request for exemption from Capital Gains Tax for lack of legal basis. SCIcTD Very truly yours, (SGD.) KIM S. JACINTO-HENARES Commissioner of Internal Revenue