BIR Ruling No. 160-82

May 4, 1982 BIR RULING NO. 160-82 30-a-1-A 000-00 160-82 Winafe Health Enterprises, Incorporated 827 Salazar Street Binondo, Manila Attention: Mr . Ng T . (Tan) Wilson President Gentlemen : This refers to your letter dated February 3, 1982 requesting a ruling on whether your purchases of books and magazines from abroad on good health and physical fitness techniques in connection with your business is considered as an expense or an asset. It is represented that your company is a newly formed corporation dealing with food supplements, body building and physical fitness equipment; that you are intending to import and/or purchase from abroad magazines and books for the purpose of enabling you to know some techniques in selling your body building and physical fitness equipment. In reply, I have the honor to inform you that business expenses deductible from gross income includes the ordinary and necessary expenditures directly connected with or pertaining to the taxpayer's trade or business (Sec. 65, Income Tax Regulations). Accordingly the cost of magazines and books needed in your business, the useful life of which is short, may be deducted from gross income. However, amounts spent for books of a permanent character are not allowable as deductions. (Sec. 69, Ibid). You may also deduct depreciation on said books of a permanent character. cdtech Your importation of said books and magazines is subject to the 10% compensating tax based on landed cost thereof pursuant to Section 204 in relation to Section 193(b), both of the Tax Code, as amended. If the imported books and magazines will be sold, bartered or exchanged by you, the same will be subject to the advance sales tax. Very truly yours, RUBEN B. ANCHETA Acting Commissioner