Tax Exemption Granted to Our Lady of Perpetual Succor School, Inc.

October 13, 1988 BIR RULING NO. 495-88 24 178-88 495-88 Gentlemen : This refers to your letter dated August 18, 1988 requesting exemption from the 20% tax on your interest income and/or yield on deposit substitute instruments and interest on your savings and time deposits. It is represented that you are a non-stock, non-profit educational institution, operated exclusively for educational purposes and that your income from operations are actually, directly and exclusively used for educational purposes. In reply, I have the honor to inform you that paragraph 3, Section 4, Article XIV of the 1987 Constitution provides, viz: "(3) All revenues and assets of non-stock, non-profit educational institutions used actually, directly, and exclusively for educational purposes shall be exempt from taxes and duties. . . ." The aforementioned Constitution was ratified at a plebiscite held for the purpose on February 2, 1987. Accordingly, the tax exemption privilege of non-stock, non-profit educational institutions took effect as of said date. Such being the case, the Our Lady of Perpetual Succor School, Inc. being a non-stock, non-profit educational institution is exempt from taxes, e.g., 10% tax on its income as an educational institution; and 20% withholding tax on its interest income and/or yield on deposit substitute instruments and interest on its savings and time deposits; customs duties and value-added tax on its importation of books and other educational materials and equipment to be actually, directly and exclusively used for educational purposes. aisadc Very truly yours, (SGD.) EUFRACIO D. SANTOS Deputy Commissioner