Income Payments to Common Carriers Not Subject to Withholding Tax

July 23, 1980 BIR RULING NO. 106-80 Nipsea Shipping Corporation Rm. 902 Sto. Cristo Development Corp. Bldg. Sto Cristo Corner Jaboneros Sts. Binondo, Metro Manila Attention: Mr . Reynaldo U . Lim Chief Accountant Gentlemen : This refers to your letter dated September 18, 1979 requesting a ruling as to whether payment for the cost of charter hire of Filipino-owned vessels operated in domestic shipping is subject to the withholding tax provisions of Revenue Regulations No. 13-78 and 6-79 implementing Presidential Decree No. 1351. In reply, I have the honor to inform you that income payment to a common carrier is not one of those subject to the withholding tax provisions of the aforesaid Regulations. Accordingly, since the income payment received by a domestic shipping company from the charter of its vessels, represents income derived from its business as common carrier, said payments are not subject to the withholding tax. (B.I.R. Ruling No. 028-79 dated May 31, 1979 and B.I.R. Ruling No. 043-79 dated June 21, 1979) Very truly yours, RUBEN B. ANCHETA Acting Commissioner