Bureau of Local Government Finance Opinion

December 3, 2002 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION Ms. Roselle F. Yglesias Finance Manager WolfPac Communications, Inc. Jannov Plaza, 2295 Pasong Tamo Ext. Makati City, 1231 Philippines Madam : This refers to your letter dated 18th November 2002 requesting "certification" for exemption from taxes on business from the City of Makati under Sec. 133, paragraph (g) of the Local Government Code (LGC) of 1991 (R.A. 7160). Representations are made that WolfPac Communications, Inc. (WolfPac for brevity) is a Board of Investment (BOI) registered (non-pioneer) company under Certificate of Registration No. EP 2002-131 issued on 17th of October 2002. Section 133 of the LGC quoted hereunder, provides as follows: "SEC. 133. Common Limitations on the Taxing Powers of Local Government Units . Unless otherwise provided herein, the exercise of the taxing powers of provinces, cities, municipalities, and barangays shall not extend to the levy of the following: ScEaAD "xxx xxx xxx. "(g) Taxes on business enterprises certified to by the Board of Investments as pioneer or non-pioneer for a period of six (6) and four (4) years, respectively, from the date of registration; "xxx xxx xxx." In view of the abovequoted provision of law and consistent with our previous opinion rendered on several cases similarly situated, this Bureau expresses the view that WolfPac, being certified to by the Board of Investments (BOI) as non-pioneer enterprise should be exempted from the payment of local business taxes as implemented under a duly-enacted Revenue Code of the City of Makati for a period of four (4) years. Such exemption shall be reckoned from the date of its registration, which is October 17, 2002. It bears emphasis, however, that the exemption granted to pioneer and non-pioneer enterprises shall apply only upon presentation of the corresponding BOI certification. Moreover, said enterprises shall still be liable to pay the Mayor's permit and other regulatory fees or service charges that the local government unit may have implemented under a duly-enacted local tax ordinance, the exemption being applicable to local taxes only. We trust that this clarifies matters. EDCIcH Very truly yours, (SGD.) MA. PRESENTACION R. MONTESA Executive Director