Tax Liability of a Forestry Licensee

February 23, 1959 BIR RULING NO. 112-59 The Regional Director BIR Regional District No. 10 Davao City S i r : This has reference to your telegram dated September 11, 1958, inquiring as to whether or not a forestry licensee whose logs are exported by another in whose name the export license and letter of credit are issued and who receives commission for undertaking the exportation is subject to the sales tax on the logs exported. llcd In reply, you are informed that articles exported, either personally or thru an agent, by the manufacturer or producer thereof are exempt from the sales tax, pursuant to subparagraph (e) of the first paragraph of Section 188 of the Tax Code. Accordingly, if the person in whose name the logs were exported acted purely as agent of the producer thereof, no sales tax is due and payable. However, if there was a sale of the logs to the person exporting, the sales tax is due and payable, the same to be based on the gross selling price of the logs to the exporter. Care should be observed in approaching the question of agency because this may constitute a clever scheme to circumvent the law. You are, therefore, advised to ascertain very carefully whether the facts warrant the existence of an agency. cdpr Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue