Rate of Advance Sales Tax Payable on Importation of Products Distributed Locally

December 18, 1986 BIR RULING NO. 278-86 164 220-86 278-86 Gentlemen : This refers to your letter dated September 1, 1986, requesting, in effect, a ruling as to the rate of advance sales tax payable by you on your importation of the following products which you distribute locally with their corresponding end-users; cdta PRODUCTS USES 1. Dextrose Monohydrate For food industry, pharmaceuticals, cattle feeds 2. Fauitol For food and pharmaceuticals 3. Corbitol Solution For pharmaceuticals, food, diabetic products, toothpaste, and production of Vitamin C 4. Glyceryl Guaiacolate Mainly pharmaceuticals (Guadaphentesin) 5. Methyl Salicylate Mainly pharmaceuticals (Oil of Wintergreen) 6. Paracetamol-Napap Mainly pharmaceuticals (Acetylparaminophenol) 7. Potassium Guaiacosul- Mainly pharmaceuticals fonate (sulphoguaiacol) 8. Sodium Tripolyphosphate For food (STPP-Food Grade) 9. Tetrasodium Pyrophosphate For food (TSPP-Food Grade) 10. Sodium Rexameta- For food phosphate (SEMP-Food Grade) 11. Sodium Acid Pyrophosphate For food 12. Potassium Carbonate For soap works, food industry, pharmaceutical, gas purification 13. Potassium Hydroxide For food, glass works 14. Sodium Silico For food and feed Aluminate (Tixolex 28) products 15. B H A Anti-oxidants for food and pharmaceutical 16. B H T Anti-oxidants for food and pharmaceutical 17. Rodigel 23 For food, soap, toothpaste, shampoos 18. Vanillin For food products 19. Ethyl Vanillin For food products 20. Coumarin For soap making 21. Vit. A 500 FG For feeds 22. Vit. A 500 WS For feeds 23. Vitamin B2 FG For feeds 24. Vitamin B1 For feeds 25. Vitamin B6 For feeds 26. Vitamin B12 1% For feeds 27. Vitamin D3 (FG) For feeds 28. Vit. E 50% Adsorbat For feeds 29. Vit. E 50% WS For feeds 30. Vitamin K For feeds 31. Calcium Pantothenate For feeds 32. Nicotinic Acid (Niacin) For feeds 33. DL Methionine For feeds 34. Sodium Gluconate For chemicals cleaning, detergents, rust, and paint stripping from metal surfaces. 35. Trisodium Phosphate For water treatment, detergent, (TG-Crystalline) metal degreasing, fermentation industries 36. Sodium Metasilicate For detergent, degreasing, mineral plottation 37. Toluene Dy-Tcosynate For food 38. Titanium Anatase (ATI) For paints, plastic & elastomers, papers 39. Titanium (Rutile) For industrial lacquiers, paints, (RL 68) printing inks 40. Titanium (Rutile RL 90) For paints, plastics & elastomers 41. Zeosil 155/185 For rubber 42. Stearic Acid Mainly for rubber 43. Sodium Penta- Preservative for fresh chlorophenate timber, paints, varnishes, adhesive, and rubber 44. Silicone Emulsion B872 For rubber and plastic, additive in floor wax, release agent in formulation of textile finishes, water repellant and release agent for industrial glassware 45. Silicone Oil 47 For wax, finishes for the V 350 cps treatment of textile threads 46. Silicone Oil 47 V Same as Oil 47 V 350 1000 cps. cps. In reply, please be informed that any article subject to the original sales tax, when used as a raw material in the manufacture or preparation of essential articles, shall, subject to certain conditions be taxed at the same rate as the finished product, except when such material is taxed at a lower rate. (Section 163(2), Tax Code, as amended by Executive Order No. 36). Consequently, of the abovementioned products imported by you, only those which are used as raw materials in the production or manufacture of essential articles enumerated in Section 163(2) of the Tax Code, e.g., processed food products, soaps, toothpaste, detergents and feeds, shall be taxed at the same rate of 10%. In such a case, the purchasers shall certify to you as importer that the articles shall be used exclusively in the manufacture or preparation of any of the said essential articles. If the purchasers fail to issue the certification, the raw materials considered as non-essential and ordinary articles shall be taxed at the rate of 30% and 20% respectively. On the other hand, if the raw materials are used in the manufacture of finished articles considered as ordinary, as in the case of Nos. 34 to 46, then the raw materials considered as non-essential and ordinary, shall, likewise, be taxed at the rate of 30% and 20%, respectively. cdtech Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner of Internal Revenue