Clarification of the meaning of "Gross Receipts" as Used in Sec. 195 of the Tax Code

October 15, 1960 BIR RULING NO. 462-60 J. Arthur Rank Overseas Film Distributors Ltd. 4th Floor Alcazar Building 412 Estero Cegado M a n i l a Attention : R . L . H . Davidson General Manager Gentlemen : This is in connection with your letter dated September 6, 1960, requesting clarification of our ruling embodied in our letter dated August 20, 1960. The following example was given in your letter: "For instance in the illustration below, which should we use as base in computing the percentage tax for January, which is payable on or before 20th February in connection with Section 195 of the Internal Revenue Code: Total Sales Cash Collection (Cash sales and sales on account) December P12,000.00 P10,000.00 January 8,000.00 9,000.00 February 5,000.00 5,500.00." "Gross receipts" as used in section 195 of the Tax Code means the actual receipts of the cinematographic film owner, lessor or distributor without any deductions. In the above example given by you the 2% tax will be computed on the P9,000.00 cash collections for the month of January if the said amount includes the cash sales for the same month. Under the law the taxpayer is not given the option to use consistently as base either total sales or cash collections. liblex Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue