Exemption of Registered Corporate Transactions from the Payment of DST

June 28, 1988 BIR RULING NO. 269-88 173 175-83 269-88 Gentlemen : In reply to your letter dated March 7, 1988 requesting exemption from payment of documentary stamp tax, please be informed that as a corporation registered with the Board of Investments on January 31, 1983 under Certificate of Registration No. 83-462 as a preferred pioneer enterprise for your animal feed ingredients projects and on November 25, 1985 under Certificate of Registration No. 85-1021 as a preferred pioneer enterprise for your project of raising of prawns, you are exempt from all internal revenue taxes except income tax, on a graduated basis, pursuant to Article 46(a), Chapter II of Title IV of P.D. No. 1789 as amended by B.P. Blg. 391, then known as the Omnibus Investment Code before its repeal by Executive Order No. 226. Accordingly, you are exempt from the payment of the documentary stamp taxes in all your registered corporate transactions. However, your exemption privilege from all national internal revenue taxes shall cover only such direct tax liabilities as may be imposed in connection with the operation of your above-named projects and shall exclude such taxes as may be transferred or passed on to you either by business practice or mere contractual arrangement. Moreover, pursuant to Section 173 (formerly 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." In other words, since you are exempt from the documentary stamp tax, the other party to the taxable document you will execute is the party directly liable. aisadc Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner