A BOI-registered Enterprise is Exempt from All Taxes, Except Income Tax

August 11, 1987 BIR RULING NO. 236-87 186 000-00 236-87 Gentlemen : This refers to your letter dated June 16, 1987 requesting a certification that you are exempt from payment of the documentary stamp tax. It is represented that you are a BOI-registered preferred pioneer enterprise; and that as certified by the Board of Investments, you have up to December 7, 1987 within which to avail of the 100% tax exemption from all taxes under the National Internal Revenue Code, except income tax. You also clarified that despite your exemption from all taxes as BOI-registered preferred pioneer enterprise, the banks and other parties with whom you conduct regular business transactions requiring the execution of a taxable document, insist in charging you for the value of the documentary stamp tax. But if you can secure a ruling confirming your tax exemption, the banks and other parties will no longer charge you documentary stamps; instead, said parties will refund to you the past documentary stamps you have assumed or paid. In reply, please be informed that as a BOI-registered enterprise exempt from all taxes, except income tax, you are exempt from documentary stamp tax (BIR Ruling No. 111-81). Pursuant to Section 186 of the Tax Code, as amended, "whenever one party to the taxable document enjoys exemption from the tax herein imposed, the other party thereto who is not exempt shall be the one directly liable for the tax". Accordingly, since you are exempt from the documentary stamp tax, the bank or other party to the taxable document is the party directly liable. iatdc Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner