Exemption from Value Added Tax of the Sale of Dolomite as Fertilizer

May 25, 1994 BIR RULING NO. 106-94 103 (c) 000-00 106-94 Atty. Rolando P. Renato Cebu Business & Investments Consultancy Ground Floor, Martinez Building Escario corner Molave Streets Cebu City S i r : This refers to your letter dated January 5, 1994 requesting for a ruling as to whether or not the sale of DOLOMITE as fertilizer to the Del Monte Philippines, Inc. by your client, the International Pharmaceuticals, Inc. (IPI) as subject to the 10% value-added tax. It is represented that International Pharmaceuticals, Inc. (IPI) sells dolomite to Del Monte Philippines, Inc. as a fertilizer for its pineapple and other agricultural crops in Mindanao; that dolomite is being used as a soil conditioner and is a good source of magnesium; that its nature as a fertilizer is confirmed by the Fertilizer and Pesticide authority in its letter to the Manager of Corporate Purchasing of Del Monte Philippines, Inc. dated September 7, 1993; that documentary evidence submitted shows that IPI has registered the DOLOMITE product (CA-22; mg-11) with the Fertilizer and Pesticide Authority under Certificate of Product Registration No. 1-4LF-095 on November 23, 1993; and, that it is your opinion that such sale is exempt from the value-added tax pursuant to Section 103 of the Tax Code, as amended. In reply thereto, please be informed that pursuant to Section 103 of the Tax Code, as amended, pertinent portion of which reads: "Sec. 103. Exempt Transactions . The following shall be exempt from the value-added tax: xxx xxx xxx (c) Sale or importation of fertilizers, pesticides, and herbicides; chemicals for the formulation of pesticides; seeds, seedlings and fingerlings; . . . " your opinion that the sale to the Del Monte Philippines, Inc. of dolomite as fertilizer by IPI is exempt from the value-added tax is hereby confirmed. However, your client, IPI, as supplier, should be duly licensed and registered with the Fertilizer and Pesticide Authority. cdta Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue