Tax Liability of Agents of the Foreign Suppliers

June 11, 1959 BIR RULING NO. 295-59 2nd Indorsement Returned to the Chief, Investigation Division, Bureau of Internal Revenue, Manila. From the report of Examiners Benjamin Maloles and Jose R. de Guzman, it appears that the NAMARCO purchases the imported goods from persons denominated in "Contract of Sale" as "sellers". It appears further that NAMARCO opens letters of credits directly in favor of the foreign suppliers and the goods are directly consigned to it. To all appearances, therefore, the so-called sellers merely brought about the sale of the products of the foreign suppliers to the NAMARCO. They are in all likelihood mere agents of the foreign suppliers and, as such, they are subject to tax as commercial brokers. He is, therefore, advised to make the corresponding assessments. Considering that this case involves potential revenues, preferential attention thereto is desired. (SGD.) JOSE ARAAS Commissioner of Internal Revenue