Skin Center, Inc. Comes Within the Purview of a Pharmacy Subject to the 1.5% Subsequent Sales Tax

October 15, 1986 BIR RULING NO. 218-86 164 000-00 218-86 Gentlemen : This refers to your letter dated October 2, 1986 stating that Skin Center, Inc. is a corporation engaged exclusively in the preparation and sale of medicines prescribed by the doctors of the Dermclinic, a sister corporation specializing in the treatment of skin diseases; that it buys ingredients as well as compounded medicines which it dispenses and/or sells to the patients of the Dermclinic, and that it does not cater to the public or outside patients but exclusively services the patients of Dermclinic. You now seek confirmation of your opinion that on the basis of the foregoing representation, the Skin Center, Inc. is not a manufacturer but only a dealer of medicines for the treatment of skin diseases. In reply, please be informed that this Office hereby confirms your said opinion. A pharmacy is a place or establishment where drugs, chemical products, active principles of drugs, pharmaceuticals, proprietary medicines or pharmaceutical specialties, devices, and poisons are sold at retail and where medical, dental and veterinary prescriptions are compounded and dispensed. (Sec. 42, RA 5921). Such being the case, the Skin Center, Inc. is not a manufacturer and since it is actually engaged in the filling of prescriptions prescribed by the doctors of the Dermclinic and the sale of medicines at retail, it comes within the purview of a pharmacy subject to the 1.5% subsequent sales tax under Section 164 of the Tax Code, as amended. Moreover, it is subject to the fixed annual tax of P200.00 in accordance with Section 161(1) of the same Code. cdtech Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner of Internal Revenue