BIR Ruling [UN-391-95]

November 9, 1995 BIR RULING [UN-391-95] Undersecretary Milwida Guevara Department of Finance Manila M a d a m : This refers to your hand written Note dated October 6, 1995, requesting our comments on the letter dated September 21, 1995 of Mr. Magdaleno B. Albarracin, Jr. of PHINMA seeking the help of the Chairman of Asian Bank to inquire from Secretary Roberto de Ocampo on the feasibility for HI, Republic and Continental Cement companies jointly to widen and concrete the national road from Norzagaray to Novaliches and for the cost to be offset, partially or in full, against the increase in taxes which the said cement plants anticipate to pay. It appears that PHINMA is also thinking, under the same concept, of concreting the 16 kms. road from the national highway in San Ildefonso, Bulacan up to its cement plant. In reply, please be informed that the proposal of the said cement companies to undertake the construction of the national road from Norzagaray to Novaliches and the national highway in San Ildefonso, Bulacan under the condition that the estimated cost in the amounts of P120 Million and P100 Million, respectively shall be offset partially or in full, against the increase in taxes which they (cement companies) anticipate to pay, cannot be granted because it amounts to a direct application of the tax proceeds to satisfy a contractual obligation without prior appropriation made by Congress (BIR Ruling No. 063-95 dated March 31, 1995) Very truly yours, BEETHOVEN L. RUALO Deputy Commissioner