Tax Status of Calasan Farm, Inc.

August 8, 1960 BIR RULING NO. 346-60 The President Calasan Farm, Inc. La Trinidad, Benguet Mountain Province S i r : Your letter inquiring whether the Calasan Farm, Inc. is subject or exempt from the percentage taxes was referred to this Office for reply. From the resolution of the Board of Directors of the Farm dated September 28, 1957, it appears that the Calasan Farm, Inc. was not organized under Act No. 3425 nor under any other cooperative law. Apparently it is an ordinary corporation incorporated under the provisions of the general corporation law, Act No. 1459, as amended. As such, it is subject to all taxes imposed on persons engaged in taxable business or businesses. Under its Articles of Incorporation, the Farm may engage in business as a producer of agricultural products (farming), manufacturer, or a dealer in general merchandise. As a producer of agricultural products it is exempt from the fixed and percentage taxes. (Sec. 188, Tax Code). But, in the case of the last two named businesses, it shall be subject to the corresponding fixed and percentage taxes. For the importation of fertilizer for its members, the Farm is liable to the compensating tax prescribed by Section 190 of the Tax Code. LLjur Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue