Non-taxability of Henry Hunter Bayne Adjustment Co., Inc.

October 1, 1958 BIR RULING NO. 541-58 3rd Indorsement Respectfully returned to the Acting Regional Director, Regional District No. 3, Manila, the herein case of Henry Hunter Bayne Adjustment Co., Inc. (now H. H. Bayne Adjustment Co.). The only question in this case is whether or not the activities or services being performed by the aforenamed company, which consist in adjusting losses covered by insurance, are such as to raise it to the category of "independent contractor", subject to the fixed and percentage taxes prescribed in Sections 182(A)(1) and 191 of the Tax Code, as amended. This Office agrees to the stand taken by H. H. Bayne Adjustment Co. in its letter dated August 13, 1958 that insurance adjusting is a profession, although being still a new profession in the Philippines, there is as yet no school offering courses leading to that profession. At any rate, since an insurance adjuster is a special agent of the insurance company employing the same, he or it cannot be considered an independent contractor. (See: 29 Am. Jur., 925, Sec. 1239; 2 Am. Jur., 17, Sec. 8) In view of the foregoing, H. H. Bayne Adjustment Co. cannot be classified as an independent contractor and, therefore, is not subject to the fixed and percentage taxes in question. Accordingly, effect should be given to the ruling dated January 30, 1957 of this Office. (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue