Request for Exemption from Capital Gains Tax on Transfer of PLDT Shares of Stock

November 27, 1996 BIR RULING NO. 130-96 21 (d) 000-00 130-96 Mr. Jose A. Alimario 51 St. Mary St. Cubao, Quezon City S i r : This refers to your letter dated January 23, 1996 stating that you own 200 shares of stock of Philippine Long Distance Telephone Company (PLDT); that the said stocks are covered by Stock Certificates Nos. SIA 28432 and SIA 03334, consisting of 100 shares each; and that you will transfer the said shares of stock to your daughter, Miss Luz C. Alimario. LLjur Based on the foregoing, you now request for exemption from capital gains tax on the transfer of your PLDT shares of stock to your daughter. In reply, please be informed that pursuant to Section 21 (d) of the Tax Code, as amended by Republic Act No. 7717, reading "Section 21. Tax on citizens or residents . xxx xxx xxx (d) Capital gains from sales of shares of stock. The provisions of Section 33 (b) notwithstanding, capital gains realized from the sale, exchange or disposition of shares of stocks in any domestic corporation shall be taxed as follows: (1) Net capital gains as defined in section 33 (a) (2) realized during each taxable year from the sale, exchange or other disposition of shares of stock not traded through a local stock exchange: Not over P100,000 10% Over P100,000 20%" you are subject to capital gains tax on the transfer of your PLDT shares of stock to your daughter. cdti Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue