Meaning of the Term "Gross Receipts" for Purposes of Applying the 4% Contractor's Tax

September 8, 1989 BIR RULING NO. 195-89 170-00 65-123 195-89 M a d a m : This refers to your letter dated March 17, 1989, in effect, requesting a ruling whether the term "gross receipts" for purposes of applying the contractor's tax covers both cash payments actually received and receivables, or whether it is only limited to cash actually received. In reply, please be informed that gleaned from the last paragraph of then Section 170 (q) of the Tax Code reading: "the term "gross receipts" means all amounts received by the prime or principal contractor as the total contract price, undiminished by any amount paid to the subcontractor under a subcontract arrangement." the term "gross receipts" for purposes of applying the 4% contractor's tax shall refer only to cash actually received and shall not include receivables not yet received. Very truly yours, (SGD.) JOSE U. ONG Commissioner