Non-taxability of Real Estate Dealer

September 10, 1958 BIR RULING NO. 489-58 Messrs. Ong Chuan, Tomy Chua, Tan Le, Ang Chi Lip, and Ong Te 671-79 Carriedo, Manila Gentlemen : Reference is made to your letter dated September 8, 1958, stating the following: llcd "Until very recently, we were able to negotiate directly with the Burke Estate Administration to lease to us the said premise, thereby eliminating the former leasee from collecting exhorbitant rentals. Because of the standing policy of the said Burke Estate Administration that they would want to deal with one person only for that single piece of property, we, the undersigned five shoe dealers have made an understanding and formed among ourselves and entered into an agreement on November 15th, 1957 (Copy of said agreement is herewith attached), by which agreement we appointed from among ourselves one, Mr. Ong Te to act and to represent in behalf of all of us five (5) members for the purpose of entering into a Contract of Lease with the said Burke Estate Administration for the said building situated at the corner of Carriedo and Plateria Streets, Manila, (Copy of said Contract of Lease is herewith attached). Further evidence in the form of an affidavit executed by the Burke Estate Administration that the said Mr. Ong Te is not deriving any profit therefrom, is also attached herewith." You now pose the question as to whether or not Mr. Ong Te is a real estate dealer, required to secure the corresponding privilege tax as such. In reply thereto, I have the honor to inform you as follows: From the agreement entered into among yourselves on November 15, 1957 and the affidavit of Mr. Pierre M. Delaplanque, representative of the owners of the leased premises, it is quite clear that each door of the leased premises is leased to each of you in your individual capacity thru your authorized representative, Mr. Ong Te. Mr. Ong Te cannot under the documentary evidence presented be considered as the sole lessee of the entire premises and to have subleased the various doors occupied by the others. Mr. Ong Te cannot, therefore, be considered a real estate dealer. Accordingly, he is not subject to the real estate dealer's fixed tax. LLjur Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue