Resale of Rattan, Considered as Sale of Agricultural Product in Its Original State, is Subject to Percentage Tax at 0% Rate

June 17, 1987 BIR RULING NO. 168-87 164 193-86 168-87 Gentlemen : This refers to your letter dated October 14, 1986 requesting in effect, for confirmation as to what category you would fall and as to the rate of tax you are subject to pay in buying Raw Rattan Materials from different provinces and re-selling them to Rattan Furniture Manufacturer in Metro Manila. In reply, please be informed that Raw Rattan Materials purchased by you are classified as agricultural non-food products. Your resale thereof, after peeling the outer most part of it and chopping them to different sizes is still considered a subsequent sale of agricultural product in its original state and, therefore, subject to the percentage tax at 0% rate. (Section 164, Tax Code, as amended by Executive Order No. 36). In other words, you are not subject to the 1.5% tax on subsequent sale. iatdc However, you remain subject to the C-13 graduated annual fixed tax imposed by Section 161(2) of the Tax Code. (Revenue Memorandum Circular No. 2-86). Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner