BIR Ruling [UN-428-95]

December 4, 1995 BIR RULING [UN-428-95] Mrs. Arcely A. Rodriguez No. 20 Doa Juana de Rodriguez Avenue Potrero, Malabon M a d a m : This refers to your letter dated August 4, 1995 requesting for our legal opinion on whether the buy and sell of feed ingredients like fish meal, soft bran (pollard) and hard bran (pollard) are subject to the value-added tax or any other percentage taxes. It is represented that bran is a by-product of either corn, rice or wheat, locally known as darak; that it can either be used as an ingredient to produce poultry and swine feeds or it can be fed directly to animals; that these ingredients are locally purchased and never imported. In reply, please be informed that Section 103(c) of the Tax Code, as amended is restricted and limited only to sale/importation of (i) finished animal feeds, i.e., as a finished product, and (ii) soya bean and fish meal; that ingredients/supplements to animal feeds which, under the Animal Feeds Law, are considered as animal feeds may not be considered as animal feeds for purposes of Section 103(c) of the Tax Code, as amended. Accordingly, the buy and sell of fish meal is exempt from value-added tax pursuant to Section 103(c) of the Tax Code. However, soft bran and hard bran being ingredients of animal feeds are subject to value-added tax.(VAT Ruling No. 244-90, December 28, 1990) Very truly yours, ALICIA P. CLEMENO Assistant Commissioner (Legal Service)