Paperboard Do Not Fall within the Purview of Fiberboard

August 26, 1986 BIR RULING NO. 156-86 163 000-00 156-86 Gentlemen : This refers to your letter dated August 7, 1986 stating that paperboard, in general, boxboard, claycoated board, chipboard, foldcote and bristol board in particular, are used mainly in the manufacturing of packaging materials; that your client, a packaging materials manufacturer believes that it is entitled to 20% tax credit on domestically manufactured paperboard and that the paper manufacturer should separately indicate in its sales invoice the amount of tax paid by the buyer; while local paper manufacturers are of the opinion that paperboard is an essential article subject to the 10% sales tax only. You now request confirmation of your opinion that paperboard, in general, boxboard, claycoated board, chipboard, foldcote and bristol board in particular, do not fall within the purview of fiberboard under Section 163(2)(k) of the Tax Code, as amended. In reply, please be informed that your opinion is hereby confirmed. Classified as an essential article, fiberboard is used in the building/housing construction, e.g., walls, floors, roofs, and doors, exterior siding and interior finishing, shelves, furniture subject to the 10% sales tax under Section 163(2)(k) of the Tax Code, as amended. On the other hand, paperboard, boxboard, claycoated board, chipboard, foldcote and bristol board which are used mainly in the manufacturing of packaging materials are subject to the 20% sales tax under Section 163(4) of the Tax Code, as amended. cdta Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner