Tax Rate of a Business of an Ice Plant Operator

September 20, 1960 BIR RULING NO. 410-60 Mr. Jose Espeleta, Jr. Palo, Leyte S i r : In reply to your letter dated August 22, 1960, I have the honor to inform you that at the commencement of your business as an ice plant operator the annual fixed tax of P20.00 shall be paid, as prescribed in section 182, and as such you are considered a manufacturer of ice, the gross sales of which is subject to 7% sales tax prescribed in section 186 of the Tax Code. However, the total cost of raw materials used which had been previously taxed under section 186 of the Tax Code is deductible for purposes of the sales tax, from the gross selling price of the ice. But operational cost such as water of electricity are not deductible. Also the cost of locally produced salt is not deductible, as it is an agricultural product which is exempt from the sales tax under section 188(b) of the Tax Code. Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue