Tax Rate of Amplifiers Used in Phonographs or Combination Radio-Phonographs or Combination Radio-Television Sets

October 16, 1958 BIR RULING NO. 597-58 Mr. Santos Alonzo Zamora St. Ozamiz City S i r : In reply to your letter dated October 7, 1958, I have the honor to inform you as follows: cdt The rate of sales tax an amplifiers is dependent upon the kind thereof. Amplifiers which are of use only in phonographs or combination radio-phonographs or combination radio-television sets are subject to 30% sales tax, pursuant to Section 185 of the Tax Code. Other amplifiers are subject only to 7% sales tax. As regards the deductibility of the cost of raw materials, the general rule is the cost of raw materials previously taxed under the same section of the Tax Code under which the articles manufactured therefrom are subject is deductible. Accordingly, if the amplifiers manufactured are subject to 7% sales tax, the cost of raw materials previously subjected to 7% sales tax is deductible; but if the raw materials were previously taxed at 30%, the cost thereof is not deductible. Conversely, if the amplifiers manufactured are subject to 30% sales tax, the cost of raw materials previously taxed at 30% is deductible, but the cost of those previously taxed at 7% is not deductible. cdta Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue