Sufficiency of the Privilege Tax-Receipt Secured in the Name of the Partnership

April 6, 1959 BIR RULING NO. 192-59 Acetimber Enterprises Co. 36 Arguelles Bldg., Rizal Ave. M a n i l a Gentlemen : Reference is made to your letter dated March 30, 1959 stating the following: cdll "On December 1, 1956 Pacita D. Tancuan and Salvador C. Reyes formed a copartnership known as PACITA D. TANCUAN AND COMPANY and/or ACETIMBER ENTERPRISES COMPANY, for the purpose of engaging in the timber business. The articles of copartnership were duly registered with the Securities and Exchange Commission on December 18, 1956. In January 1956 the copartnership was duly registered with the Bureau of Internal Revenue, and it paid the necessary licenses and taxes (Priv. Tax C-13 and C-14 as timber Producer and Importer and Exporter). "Before the copartnership was organized, there was an agreement between Pacita D. Tancuan and Salvador S. Reyes that Pacita D. Tancuan will give the Acetimber Enterprises Co. the right to operate her timber concession at Luna, Mt. Prov. which she acquired on August 25, 1956, only three months and six days before the copartnership was formed, and she had not cut any single log from the said concession or transacted any business yet. Consequently, the Acetimber Enterprises Co. or Pacita D. Tancuan & Co. took the concession as its own and operated the said concession in 1957 up to the present. The volume involved in 1957 was 1,190.97 cubic meters and was 847.40 cubic meters in 1958. Logs cut from this concession were sold and exported directly to Japan by the same company. From the beginning of operation until now, the company has been the one spending for the construction of the road, paying the cutters, laborers, haulers; supplying all kind of equipments and all necessary expenses, including the Forest Charges, Reforestation Fund, Forestry Bond, Forestry Renewal License Fee, etc; all these are duly recorded in the books of the Acetimber Enterprises Co. or Pacita D. Tancuan & Co." You now request opinion as to whether or not Pacita D. Tancuan should still provide herself with the corresponding privilege tax-receipt or whether or not the privilege tax-receipt secured in the name of the partnership is sufficient. In reply thereto, I have the honor to inform you that from the time of the constitution of the partnership, and her assignment to the latter of her right to exploit her timber concession, she ceased personally to be a timber producer. The producer since then is the partnership. Accordingly, she does not have to provide herself with a privilege tax-receipt as a timber producer nor keep the required books of accounts. Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue