BIR Ruling No. 230-83

December 15, 1983 BIR RULING NO. 230-83 S i r : This refers to your Memorandum to the Prime Minister dated September 12, 1983 requesting the waiver of transfer taxes, documentation and registration fees as a consequence of the acquisition of all the assets of Western Minolco Corporation (WMC) by the National Development Corporation (NDC). It appears that NDC has acquired through the Development Bank of the Philippines (DBP) all the assets of WMC for use in the operation of Negros Occidental Copperfield Mines, Inc. (NOCOMIN) Hinobaan Project; that payment for these assets will be made by NDC to DBP and other WMC creditors over a 25-years period; that NDC's acquisition of WMC assets would entail the payment of transfer taxes, documentation and registration cost estimated at P14 Million which taxes and cost will be paid either by NDC or initially advanced by DBP for and in behalf of NDC. In other words WMC's assets were sold to NDC but payment for said assets will be made to DBP and other creditors. In reply, I have the honor to inform you that under the foregoing facts, WMC is subject to income tax on the gain, if any, derived from the sale of its assets. Likewise, the sale of the assets involving real property is subject to documentary stamp tax. This Office cannot waive the collection of said taxes for lack of legal basis. Moreover, waiver of the payment of transfer taxes and registration fee required under Article I, Section 7, of the Local Tax Code (PD 231) and Section 111(c) in relation to Section 51 of P.D. No. 1529 (Property Registration Decree) respectively, which taxes and fees are not internal revenue taxes, is not within the province of this Office to decide. Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner Bureau of Internal Revenue