Tax Liability of a Building Contractor

May 8, 1959 BIR RULING NO. 245-59 2nd Indorsement Returned to the Chief, Investigation Division, the docket bearing on the internal revenue case of Mr. Juan M. Villegas, Nasugbu, Batangas. A surveyor who accepts contracts to survey, supplying the necessary materials incident thereto, such as "mohones" (markers), hiring other surveyors to assist him is not a contractor within the purview of section 191 of the Tax Code. The 'contract to survey' is a contract for professional service. The service performed by the surveyor under such contract constitutes the exercise of his profession. The surveyor-contractor in such case, including the surveyors employed by him are only subject to the occupation tax. As a building contractor, however, the surveyor is considered engaged in a distinct and separate business. His gross receipts as such building contractor is necessarily subject to the 3% contractor's tax. (SGD.) JOSE ARAAS Commissioner of Internal Revenue