Distinct and Separate Privilege Tax-receipts of Branch Establishment Maintained by a General Merchant

March 10, 1958 BIR RULING NO. 173-58 Josue, Guzman & Co. Rm. 502 Roman Santos Bldg. Plaza Goiti, Manila Attention : Mr . Benjamin P . Josue Gentlemen : Reference is made to your letter dated February 3, 1958, stating the following: cdt "We would like to inquire what taxes and where the taxes should be paid by a branch office to be operated under the following conditions; 1. The business is general merchandising. 2. The branch will be located at Cebu City. 3. The sales invoices will be issued by the branch office. 4. The accounting for the branch office will be done at Pasay City." In reply thereto, I have the honor to inform you that every branch establishment maintained by a general merchant must be provided with distinct and separate privilege tax-receipts, pursuant to Section 178 of the Tax Code. Such being the case, should the aforementioned branch office operate in Cebu City as proposed, it shall be subject to the graduated fixed annual tax (C-13) prescribed in Section 182(A)(2) of the Tax Code, as amended. The initial graduated fixed tax of P10.00 is payable at the commencement of the business. Thereafter, the said tax shall be paid at the option of the taxpayer on or before January 20 of each year, if paid annually, or, on or before January 20 and July 20, if paid semi-annually, and the same shall be based on the gross annual sales during the preceding calendar year. In the instant case, while the controlling books may be kept in the main establishment at Pasay City, the Cebu branch must nevertheless keep such books and records as would clearly reflect all the transactions effected therein. (Sec. 20, Rev. Reg. No. V-1). In this connection, attention is also invited to the requirements of prior registration and approval of books of accounts and other records and of sales invoices and receipts. Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue