Feldspar is Classified as Non-Metallic Mineral in Powdered Form; Hence, Subject To 2% Excise Tax Based on Actual Market Value of Annual Gross Output Thereof at the Time of Removal

November 27, 1996 BIR RULING NO. 131-96 151 (a) (2) 000-00 131-96 GG Feldspar Philippines, Inc. Pasuquin, Ilocos Norte Attention: Mrs . Inocencia L . Go President Gentlemen : This refers to your letter dated January 10, 1996 stating that you are engaged in the business of mining feldspar powder and rocks; that you extract the feldspar mineral and after a little cleaning, you deliver the same in its original state to ceramics and glass manufacturers in Manila without it undergoing any processing whatever; and that the BIR personnel in Ilocos Norte insists that you are covered by VAT so that you are registered as a VAT taxpayer. LLphil Based on the foregoing, you are requesting clarification as to whether you are subject to the value-added tax imposed under Section 100 of the Tax Code, as amended by Republic Act No. 7716, on your sale of feldspar mineral to ceramics and glass manufacturers. In reply, please be informed that feldspar is classified as a non-metallic mineral in its powdered form, hence, subject to the 2% excise tax based on the actual market value of the annual gross output thereof at the time of removal, in the case of those locally extracted or produced, or the value used by the Bureau of Customs in determining tariff and customs duties, net of excise tax and value-added tax, in the case of importation, pursuant to Section 151 (a) (2) of the Tax Code, as amended by Republic Act No. 7729. In addition, you are subject to the 10% VAT pursuant to Section 100 in relation to Section 126 both of the same Code. Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue