Request for Reconsideration of BIR Ruling No. 193-92

October 22, 1992 BIR RULING NO. 295-92 50 193-92 295-92 Mr. Bartolome C. Fernandez, Jr. c/o Commission on Audit Commonwealth Avenue Quezon City S i r : This refers to your letter dated July 6, 1992 requesting reconsideration of BIR Ruling No. 193-92 dated July 3, 1992 addressed to the Commission on Audit, Attn.: Chairman. Eufemio C. Domingo to the effect that your monthly reimbursement of P10,000.00 under your consultancy agreement with the Commission on Audit is subject to income and consequently to withholding tax. In reply, please be informed that if as represented, the amount of P10,000.00 is a reimbursable expanse incurred in connection with your consultancy services, then the same must be covered by receipts and other documents to be submitted to the Commission on Audit and the latter shall pay you on the basis of the statement of expenses and other supporting documents. As to whether you are on call basis as consultant, your service fees would still constitute compensation subject to income tax and consequently to withholding tax pursuant to Section 1(a)(6) of Revenue Regulations No. 6-85. It has been the constant and uniform holding that exemption from taxation is not favored and is never presumed, so that if granted it must be strictly construed against the taxpayer. Affirmatively put, the law frowns on exemption from taxation, hence, an exempting provision should be construed strictissimi juris . (Catholic Church vs. Hastings, 5 Phil 70; Esso standard Eastern, Inc. vs. Acting Commissioner of Customs, L-D1241, Oct. 28, 1966, 18 SCRA 488; Phil. Acetylene vs. Comm. of Int. Rev., L-19701, Aug. 17, 1967; 20 SCRA 1056; Comm. of Int. Rev. vs. Guerrero, L-20942 Sept. 22, 1967, 21 SCRA 180; Manila Electric Co. vs. Vera, L-29987, Oct. 22, 1975, 67 SCRA 351) In view thereof, it is regretted that your request for reconsideration of BIR Ruling No. 193-92 dated July 3, 1992 has to be, as it is hereby denied for lack of legal basis. This is the final ruling of this Office on this matter. aisadc Very truly yours, JOSE U. ONG Commissioner of Internal Revenue