Clarification on the VAT Liability of Coagulated Rubber Latex or Rubber Cuplumps
BIR Ruling No. 532-88 • Bureau of Internal Revenue (BIR) Issuances • Rulings (Numbered) • Nov 9, 1988
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November 9, 1988 BIR RULING NO. 532-88 103 (a) 133-86 532-88 S i r : This refers to your letter dated October 6, 1988 in effect requesting clarification whether coagulated rubber latex or rubber cuplumps produced by your clients are subject to VAT. It is ascertained that coagulated rubber latex or cuplumps are rubber juice/sap gathered from the bark of rubber trees and placed in a solution of glacial acetic acid to coagulate. In reply, please be informed that coagulated rubber juice/sap gathered from rubber plantation is an agricultural product. The transformation and/or processing of liquid latex (rubber juice/sap) into coagulated rubber latex is not considered manufacturing. (CIR vs. American Rubber Co. 18 SCRA 842) Accordingly, the coagulated rubber latex or cuplumps produced by your client are agricultural non-food products still in their original state; hence, exempt from VAT pursuant to Section 103(a) of the Tax Code, as amended by Executive Order No. 273. Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner
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