Non-payment of Contractor's Percentage Tax

February 26, 1959 BIR RULING NO. 124-59 3rd Indorsement Respectfully returned to the Regional Director, Regional District No. 3, Manila, the within papers on the internal revenue case of the M. Greenfield, Inc., 2568 Lamayan, Sta. Ana, Manila, with the information that the corporation cannot be held liable to the payment of the contractor's percentage tax prescribed under Section 191, as amended by Republic Act No. 1612, prior to August 24, 1956, on the compensation it received for services rendered to a foreign principal. The service rendered which consists apparently of the embroidery of fabrics furnished by the foreign principal is not among those enumerated in said Section 191. LLphil Beginning June 13, 1958, the date of effectivity of Republic Act No. 2072, this type of contractors were exempted from tax. They are likewise exempt from tax during the period from August 24, 1956 to June 12, 1958, pursuant to the ruling of the Secretary of Finance dated January 13, 1959. (SGD.) JOSE ARAAS Commissioner of Internal Revenue