Donation to Cavite College of Fisheries Exempt from Capital Gains Tax

June 18, 1993 BIR RULING NO. 263-93 DONATION TO CAVITE COLLEGE OF FISHERIES EXEMPT FROM CAPITAL GAINS TAX 94 (a) (2) 056-91 263-93 Cavite College of Fisheries Bucana, Naic, Cavite Attention: Beato C . Cefre Voc . School Superintendent 1 This refers to your letter dated March 20, 1993 requesting exemption from taxes on donations you will receive from Levi Strauss & Company. cdtech It is represented that the Cavite College of Fisheries is a government educational institution offering secondary, post secondary and tertiary levels of education with emphasis on fishery curriculum; and that it is under the administrative control and supervision of the Department of Education, Culture & Sports. In reply, please be informed that under Section 94(a) (2) of the Tax Code, as amended, gifts made to or for the use of the National Government, or any entity created by any of its agencies which is not conducted for profit, such as the Cavite College of Fisheries, shall be exempt from the donor's tax imposed under Chapter 2, Title II of the same Code. Accordingly, donations to be made in your favor from private entities are exempt from the donor's tax. Moreover, under Section 29(h) (1) of the Tax Code, as amended, gifts actually paid or made within the taxable year to or for the use of the Government of the Philippines, or any of its agencies or any political subdivision thereof, for exclusively public purposes shall be allowed as deductions in computing taxable income subject to tax under Section 24(a) of the Tax Code, in an amount not in excess of 6% in the case of an individual, and 3% in the case of a corporation, of the taxpayer's (donor or contributor) taxable income derived from business as computed without the benefit of the said donations. Such being the case, for income tax purposes, donations to be made in your favor are deductible from the donor's, i.e., Levi Strauss & Company's taxable income derived from business, as computed without the benefit of said donation, in an amount not exceeding 6% in the case of an individual donor; and 3% in the case of a corporate donor. LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue