10% Overseas Communications Tax on Multinational Companies with Regional Headquarters Located in the Philippines

August 26, 1988 BIR RULING NO. 416-88 118 (a) 159-82 416-88 Gentlemen : This refers to your letter dated July 28, 1988 requesting exemption from the 10% overseas communications tax prescribed under Section 118(a) (formerly Section 240(a)) of the Tax Code, as amended. cdta It is represented that as a multinational corporation with regional or area headquarters in the Philippines you are registered and operating within the confines of Presidential Decree No. 218 and as such is exempt from all taxes, including the 10% overseas communications tax. In reply, please be informed that Section (118(b) of the Tax Code explicitly limits the exemption from the payment of the 10% overseas communications tax to only four (4) entities, namely: 1. Government, 2. Diplomatic Services, 3. International Organizations, and 4. News Services. It appearing that multinational companies with regional headquarters located in the Philippines are not among those enumerated, it is regretted that your request for exemption from the 10% overseas communications tax cannot be granted for lack of legal basis. cd Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner