Tax Liability of Flower Shop for Reselling Flowers after Arranging Them into Wreaths and Bouquets

September 23, 1986 BIR RULING NO. 193-86 164 118-86 193-86 S i r : This refers to your letter dated July 29, 1986, stating that you are the owner of a flower shop named Nature's Touch located at 967 J.P. Rizal Street, Makati, Metro Manila, with a C-13 license, and that you buy fresh flowers and resell them after they are arranged into wreaths and bouquets. Based on the foregoing facts, you now request information as to whether you are subject to the sales tax on subsequent sale. In reply, please be informed that fresh flowers purchased by you are classified as agricultural non-food products. Your resale thereof, after arranging them into wreaths and bouquets 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. However, you remain subject to the C-13 graduated annual fixed tax imposed by Section 162(2) of the Tax Code. (Revenue Memorandum Circular No. 2-86). aisadc Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner of Internal Revenue TAN: T5150-J0923-A-4