BIR Ruling [UN-371-95]

October 11, 1995 BIR RULING [UN-371-95] Sagara Metro Plastic Industrial Corporation 19 Comet Street, Bel-Air Village II 1209, Makati, Metro-Manila Attention: Mr . Enrico H . Bonsol Finance & Accounting Manager Gentlemen : This refers to your letter dated February 1, 1995 requesting for the issuance of a certificate of exemption from expanded withholding tax pursuant to Revenue Regulations No. 12-94. It is represented that Sagara Metro Plastic Industrial Corporation is a BOI registered enterprise, with Certificate of Registration No. EP94-295 dated September 5, 1994 on a non-pioneer status as defined under Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987. One of the incentives provided by said code is an income tax holiday of three (3) years from November, 1994 or from the actual start of commercial operations whichever comes first, but in no case earlier than the date of registration. In reply, please be informed that pursuant to Section 4(b)(2) of Revenue Regulations No. 6-85, as amended by Revenue Regulations No. 12-94 implementing Section 50(b) of the Tax Code, as amended, the withholding tax prescribed in these regulations shall not apply to income payments to persons enjoying exemption from payment of income taxes pursuant to the provisions of the Omnibus Investments Code of 1987, as amended. Accordingly, since you are registered with the BOI and enjoying exemption from the payment of income taxes for a period of three (3) years from November, 1994 or from the actual start of commercial operations whichever comes first in accordance with the Omnibus Investments Code of 1987, this Office is of the opinion as it hereby holds that you are exempt from the creditable expanded withholding tax imposed under Revenue Regulations No. 12-94 on income payments received by your company for a period of three (3) years up to November 1997. (BIR Ruling No. 163-94, dated December 2, 1994). cdt Very truly yours, ALICIA P. CLEMENO Assistant Commissioner (Legal Service) By: ALICIA L. TOMACRUZ Head Rev. Executive Assistant (Legal Service)