Applicable Tax/es on Several Articles

June 3, 1988 BIR RULING NO. 235-88 103 (b) 000-00 235-88 Gentlemen : This refers to your letter dated April 15, 1988 requesting a new ruling on the applicable tax/es on the articles hereinbelow enumerated, which were then exempt from the advance sales tax under BIR Ruling No. 118-86 prior to the effectivity of the Value-Added Tax Law, as follows: S P I C E S 1. Tarragon Leaves 13 Cinnamon (bark) 2. Rosemary Leaves 14. Basil Leaves 3. Sage Leaves 15. Coriander Seeds 4. Oregano Leaves 16. Cumin Seeds 5. Savory Leaves 17. Anise Seeds 6. White Pepper 18. Allspice 17. Sesame Seeds 19. Nutmeg 8. Fennel Seeds 20. Laurel or Bay Leaves 9. Cloves 21. Caraway 10. Celery Seeds 22. Thyme Seeds 11. Red Pepper 23. Tea Leaves Dust 12. Marjoram Leaves DEHYDRATED VEGETABLES 1. Dehydrated Onions 5. Dehydrated Red Pepper 2. Dehydrated Garlics 6. Dehydrated Parsley 3. Dehydrated Cabbage 7. Dehydrated Mushroom 4. Dehydrated Celery You also want to know your tax liability when you repack the aforesaid imported articles and thereafter sell them. In reply, please be informed that the abovementioned spices and dehydrated vegetables are agricultural food products in their original states exempt from the value-added tax pursuant to Section 103(b) of the Tax Code, as amended by Executive Order No. 273 and as implemented by Section 9(b)(2) of Revenue Regulations No. 5-87.However, any of the aforesaid articles as ground and packed in bottles or cans and sold is considered a manufactured article (BIR Ruling No. 315-87); hence, subject to the 10% value-added tax if your sales exceed P200,000.00 during any 12-month period. (BIR Ruling Nos. 019-88 and 117-88) cdti Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner