Amendment of Sec. 5(c)(5) of Rev. Reg. No. 11-86 on Tax Liabilities of BOI-registered Pioneer Enterprises

November 27, 1986 BIR RULING NO. 262-86 163 (4) 160-84 262-86 Gentlemen : This refers to your letter dated November 4, 1986 requesting for and in behalf of your client, Bataan Pulp and Paper Mills, Inc., for the amendment of Section 5(c)(3) of Revenue Regulations No. 2-86 (now Revenue Regulations No. 11-86) and Example 2 thereof, and that the computation of the sales tax liabilities of the Board of Investments (BOI) registered pioneer enterprises enjoying partial tax exemption in accordance with BIR Ruling No. 160-84 issued to you on September 25, 1986 be upheld. cdt In reply, please be informed that, for being meritorious, this Office has finally decided that the aforesaid provisions of Section 5(c)(5) of Revenue Regulations No. 11-86 be amended so that instead of "the available tax credits during a taxable quarter shall first be applied to the gross sales tax due" as provided therein the exemption, full or partial, being enjoyed by the registered BOI enterprise should first be deducted from the gross sales tax due. This is in accordance with the aforesaid BIR Ruling No. 160-84 which ruled that the method of computing the sales tax liabilities of BOI registered pioneer enterprises shall be as follows: Gross Sales tax due P100.00 20% exemption 20.00 Net Sales Tax Due P80.00 Less: Tax Credit 30.00 Sales Tax Due P50.00 The aforesaid computation under BIR Ruling No. 160-84 is, therefore, upheld. cd Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner of Internal Revenue