Failure of a Taxpayer to Register His Business or Trade Name

October 9, 1959 BIR RULING NO. 508-59 A & M Trading & Supply Co., Inc. 466 San Luis, Ermita M a n i l a Gentlemen : In reply to your letter dated September 9, 1959, I have the honor to inform you that the failure of a taxpayer to register his business or trade name constitute a violation of section 203 of the Tax Code and is punishable under section 352 of the same Code by a fine of not more than P300 or by imprisonment for not more than six (6) months, or both. However, the taxpayer may extrajudicially settle such violation by the payment of an amount computed at P5.00 for every capital investment of P2,500 or fractional part thereof, but not to exceed P300.00 as compromise, pursuant to General Circular No. V-240. With respect to your case, if you had in fact registered your business or trade name whether as manufacturers or as dealers, you are deemed to have complied with the requirement of the law. As regards your failure to pay the percentage (sales) tax on the sales of your manufactured products, it may be stated that while you have actually been paying what you believe to be the tax due on your business, nevertheless the mere fact that you have not been paying the correct tax constitute a violation of the law. Considering, however, your good faith, only a nominal amount will be collected from you as compromise in extrajudicial settlement of the penal liability arising from your violation of the law. In this connection, please be informed that your case has been referred on even date to the Regional Director of Manila for appropriate action. Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue