Basis of the 3% Tax Payable by the Transit Broadcast Corporation

March 21, 1960 BIR RULING NO. 138-60 Mr. Domingo B. Melliza Attorney-at-Law 416 Samanillo Building Escolta, Manila S i r : Reference is made to your letter dated March 12, 1960, stating the following: "It appears that the business of our clients consist in contracting radio time with Station DZRM and selling it to advertisers under which arrangement it receives only 50% of the proceeds paid and Station DZRM gets the 50% thereof." By verbal representation, you clarified that your client solicits advertisers and uses its radio time to effect the advertisement desired thru its own planned program. Of the amount paid by the advertisers to your client, your client pays thereof to the station. You now request opinion from this Office as to whether or not the 3% tax payable by your client, the Transit Broadcast Corporation on its gross receipts as business agents should be based on the full amount received by it from the advertisers or on only 50% thereof. In reply thereto, I have the honor to inform you that the 3% tax payable by your client shall be based on the full amount received by it from the advertisers without deducting therefrom any amount it pays to the station. prcd Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue