Tax Liability of "OESCO"

June 15, 1960 BIR RULING NO. 257-60 Messrs. Balangun & Lim Certified Public Accountants R-412 B.P.I. Building M a n i l a Gentlemen : Reference is made to your letter dated May 20, 1960, stating that your client, "OESCO" is a manufacturer of office furniture and fixtures using imported and locally purchased raw materials and requesting information as to whether or not its billing of the tax to the customer is in accordance with General Circular Nos. 431 and 440. Its billing on the invoice is illustrated as follows: Sales price P957.48 7% Sales tax 42.52 P1000.00 On this sale you represented the deductible cost of raw materials at P350.00. In reply thereto, I have the honor to inform you that inasmuch as on the basis of the figures submitted by you, the tax due is P42.52, your client's billing of this amount as a separate item in the sales invoice is in order. However, the deductible cost of raw materials should be indicated in the invoice. Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue