BIR Ruling No. 088-63

November 21, 1963 BIR RULING NO. 088-63 Sycip, Gorres, Velayo & Co. Certified Public Accountants 490 San Luis, Manila Attention : Mr . A . S . Monson Tax Department Gentlemen : In answer to your letter dated October 4, 1963 requesting information whether pineapple seeds or seedlings to be imported by your client, an operator of an agricultural plantation, are subject to the compensating tax prescribed by Section 190 of the Tax Code, I have the honor to inform you as follows: prcd A perusal of the definitions of terms submitted by you as: "commodity", "wares", and "merchandise" does not necessarily exclude pineapple seeds or seedlings under the purview of the said definitions. In fact the terms "production of goods for commerce", "goods", "wares", "products", "commodities", "merchandise", or "articles or subject of commerce" . . . is not a static concept, and has been made elastic to meet legislative views". (Pederson v. J. V. Pitsgerald Const. Co., 18 N.Y.S. 2d, 920, 173 Misc. 188, Words & Phrases, Vol. 7A, p. 589). Your contention that pineapple seeds and seedlings do not come within the purview even of the word "commodities" found in Section 190 of the Tax Code is untenable, because they are undoubtedly "products" of value which become "articles of sale" or "commerce", and, therefore, within the scope of the definition submitted. In two similar cases, this Office held that 5-day old chicks imported for breading purposes were subject to the compensating tax. (BIR Ruling, May 14, 1956; Sec. 190(36), Araas "Annotations & Jurisprudence on the National Internal Revenue Code, as Amended", 1963 Edition). Also imported Salmon (live) and trout for breeding are subject to the 7% compensating tax. (BIR Ruling No. 374, s. of 1951). In view of the foregoing, pineapple seeds or seedlings to be imported by your client are subject to the 7% compensating tax prescribed by Section 190, in relation to Section 186, both of the Tax Code. LLpr Very truly yours, (SGD.) RAMON T. OBEN Acting Commissioner of Internal Revenue