Assessment of the Sales Tax on the Bread Manufactured by Bakers

September 2, 1959 BIR RULING NO. 447-59 Mr. Federico Agrava Attorney-at-Law *05 F C I Building 416 Dasmarias, Manila S i r : In answer to your letter dated January 14, 1959, I have the honor to inform you that in assessing the sales tax on the bread manufactured by bakers, the cost of the flour purchased from the Republic Flour Mills, Inc. is deductible from the gross selling price of the manufactured bread in accordance with section 186-A of the Tax Code. It may be stated, however, in this connection, that in applying the provisions of the aforesaid section of the Tax Code, the cost of raw materials (in the instant case, the flour) purchased from tax-exempt industries prior to June 22, 1957 shall no be allowed as a deduction although they are or may be used after said date. In other words, only the cost of such raw materials purchased on or after June 22, 1957 shall be deductible. Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue