Reconsideration of the August 8, 1958 Ruling

November 26, 1958 BIR RULING NO. 693-58 Messrs. Felipe B. Ollada and Associates Certified Public Accountants 505 China Bank Building Manila Gentlemen : Reference is made to your letter dated October 21, 1958, requesting, in effect, reconsideration of our ruling dated August 8, 1958 (B.I.R. Ruling No. 430, current series). In support of said request, you assert that the fact stated in a paragraph of your letter dated July 16, 1958, quoted in our said ruling, that the Philippine Publishing House (hereinafter referred to as "House"), which is owned and operated by the Philippine Union Mission Corporation of Seventh-Day Adventists (hereinafter referred to as "Corporation"), accepts printing jobs from other parties, such as the American Bible Society, is merely hypothetical, the truth being that the printing activities of the "House" are limited to religious matters which are subsequently distributed by the "Corporation" to its provincial branches and agencies as a means of disseminating religious information and belief. In answer thereto, I have the honor to inform you that, based on your representations that neither the "House" nor the "Corporation" accepts printing jobs from third parties and that the former's printing activities are confined exclusively to religious matters being distributed by the latter to its branches and agencies, the "Corporation" is exempt from the 3% printer's tax imposed in Section 191 of the Tax Code on the printing activities of the "House". However, considering that the prohibition to tax is limited to the exercise and enjoyment of religious profession and worship and considering further that the imposition of the compensating tax upon importations of religious organizations for use in connection with their activities is not tantamount to taxing the right of religious profession and worship (which considerations have been extensively discussed in our said Ruling No. 430), notwithstanding your said representations, this Office is still of the opinion and so again holds that printing supplies and equipments imported by the "House" and/or the "Corporation" for use by the former are subject to the compensating tax provided for in Section 190 of the same Code. The only case under which said supplies and equipments may be exempted from the tax is when the same, or any of them, are consigned to the "Corporation" as donations in accordance with Republic Act No. 1916, which took effect on June 22, 1957. In such case, however, the procedure prescribed by Department Order No. 18 of the Department of Finance, implementing said law, for applying for tax-exemption should be followed. cdtech Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue