BIR Ruling No. 283-82

November 12, 1982 BIR RULING NO. 283-82 24-e 196-81 283-82 International Flavors & Fragrances (Philippines) Inc. IFF Center, No. 14 Arayat Street Mandaluyong, Metro Manila Attention: Mr . Manuel R . Dimatulac Controller Gentlemen : This refers to your letter dated July 21, 1982 requesting a ruling on whether or not you are subject to the 10% corporate development tax imposed under Section 24 (e) of the Tax Code of 1977, as amended. cd It is represented that International Flavors & Fragrances (Philippines) Inc. is registered under R.A. No. 5455 and is a wholly (100%) owned subsidiary of International Flavors and Fragrances, Inc., (IFF) a multinational corporation based in New York, U.S.A., a leading creator and manufacturer of flavors, fragrances and aromatic chemicals used by other manufacturers to impart or improve the flavor or fragrance in a wide variety of consumer products; that IFF is a public corporation with a total of P5,996 stockholders and whose shares of stocks are traded at the New York Stocks Exchange. In reply, please be informed that International Flavors & Fragrances (Philippines) Inc. is not a closely-held corporation for purposes of the 10% corporate development tax imposed by Section 24 (e) of the Tax Code, as amended by Presidential Decree No. 1773, it appearing that it is wholly-owned by International Flavors & Fragrances, Inc. which is a U.S. corporation with 5,996 stockholders. A closely-held corporation, for purposes of the 10% corporate development tax, is a corporation at least 50% of the total combined voting power of all classes of stock entitled to vote at any time during the taxable year, is owned directly or indirectly by or not more than five (5) persons, natural or juridical. This definition does not apply in your case, because you are not considered owned by the single parent corporation but by the 5,996 stockholders of said parent corporation. (Sec. 2(c) Revenue Regulations No. 7-81 implementing Section 24(e), Tax Code, as amended by P.D. No. 1773). cdta Very truly yours, RUBEN B. ANCHETA Acting Commissioner