Non-taxability of a Mere Dealer of Locally-Purchased Articles

November 16, 1959 BIR RULING NO. 588-59 Asilo & Sons Enterprises 13 Victory Avenue Quezon City Gentlemen : In answer to your letter of the 5th instant, I have the honor to inform you that if, as claimed therein, you are a mere dealer of locally-purchased articles, your subsequent sales thereof to government bureaus, offices, agencies and instrumentalities are not subject to any percentage tax and, therefore, also not subject to the withholding provisions of Republic Act. No. 1051, as implemented by Revenue Regulations No. V-40. Accordingly, no tax need be deducted and withheld from money payments that may be due you by reason of said sales to any of those bureaus, offices, agencies and/or instrumentalities. It may be stated that as long as the articles you deal in are only locally purchased, you are not subject to the aforesaid withholding provisions regardless of whether such articles are sold by wholesale or at retail. cdll Very truly yours, (SGD.) MELECIO R. DOMINGO Commissioner of Internal Revenue