Fixed and Percentage Taxes of the Calamba Waterworks

March 31, 1960 BIR RULING NO. 196-60 The Regional Director BIR Regional District No. 5 San Pablo City S i r : This is in connection with the case of the Calamba Waterworks involving the sum of P5,732.61 representing fixed and percentage taxes allegedly due from it. The Executive Secretary in his 6th Indorsement dated August 16, 1954 exempted the Metropolitan Water District from the payment of internal revenue taxes for the reason that it cannot be considered engaged in a taxable business. "The same being public utility charged with the furnishing of adequate supply of water and sewerage service". The Secretary of Finance in his 1st Indorsement dated October 25, 1954 suggested that the assessment against the Pagsanjan Waterworks System for percentage tax as producer of water be countermanded following the aforesaid decision of Executive Secretary. In view of the foregoing, this Office on the opinion that if the operation of the Calamba Waterworks is similar to the operation of the Metropolitan Water District and the Pagsanjan Waterworks, the same is exempt from tax. lexlib Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue