BIR Ruling No. 206-11

July 1, 2011 BIR RULING NO. 206-11 Section 101 (A) (2) of the NIRC of 1997, as amended; BIR Ruling No. 062-99; BIR Ruling No. DA-019-2001; BIR Ruling No. DA-302-2003; BIR Ruling No. DA-(DT-063) 663-09 Stateland, Inc. 3/F, State Center Building 333 Juan Luna St. Binondo, Manila Attention: Bernardo M. Nicolas, Jr. Head-Prop. Acqui. & Proc. Dept. Gentlemen : This refers to your letter dated May 13, 2010, requesting exemption from the payment of donor's tax on the donation, by Stateland, Inc. and E.M. Ramos Development Corporation in favor of the City of Caloocan with Taxpayer's Identification No. 000-341-850-000, 000-712-565-00 and 001-377-237-000, respectively, in its subdivision project known as the "North Olympus-Phase I" located in Brgy. Urduja, Zabarte, Novaliches, Caloocan City, of road lots covered by Transfer Certificates of Title Nos. T-73285, T-73550-A, T-73658, T-73868, T-73898, T-74201, T-74342, T-74343, T-74344, T-74345, T-74346, T-74347, T-74348, T-74349, T-74350, T-74351, T-74352, T-74353, T-74354, T-74355, T-74356, T-74357, T-74358, T-74359, T-74360, T-74361, T-74362, T-74363, T-74364, T-74365, T-74366, T-74367, T-74368, T-74369, T-74370, T-74371, T-74372, T-74373, T-74374, T-74375, T-74376, T-74377, T-74378 and open spaces covered by Transfer Certificates of Title Nos. T-73360, T-73661 all issued by Registry of Deeds for the Quezon City. Submitted in support of your request are the following documents: 1. Photocopy of the Deeds of Donation dated June 8, 2009; 2. Photocopies of the corresponding Transfer Certificates of Title; 3. Photocopies of the corresponding Tax Declarations; and 4. Copy of the Subdivision Plan. In reply, please be informed that Section 101 (A) (2) of the National Internal Revenue Code, as amended, provides: "SEC. 101. Exemption of Certain Gifts. The following gifts or donations shall be exempt from the tax provided for in this chapter: (A) In the case of Gifts Made by a Resident. xxx xxx xxx (2) Gifts made to or for the use of the National Government or any entity created by any of its agencies which is not conducted for profit, or to any political subdivision of the said Government; and . . ." CTaIHE According to the above, donations made for the use of the National Government or any entity created by any of its agencies which is not conducted for profit or to any political subdivision of the said Government shall be exempt from the donor's tax. Considering that the donation of open spaces and road lots was made by Stateland, Inc. and E.M. Ramos Development Corporation in favor of the City of Caloocan, a political subdivision of the National Government, said donation, is exempt from donor's tax. (BIR Ruling No. 062-99 dated May 5, 1999, BIR Ruling No. DA-019-2001 dated February 15, 2001, BIR Ruling No. DA-302-2003 dated September 16, 2003 and BIR Ruling No. DA-(DT-063) 663-09 dated November 11, 2009). This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) KIM S. JACINTO-HENARES Commissioner of Internal Revenue