Bureau of Local Government Finance Opinion

April 10, 2003 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION Mrs. Lilian O. Ancheta Comptroller Vibal Publishing House, Inc. G. Araneta Ave. cor. Maria Clara St. Quezon City Madam : This refers to your letter dated March 31, 2003 requesting a ruling that the publishing, printing and sale of school texts/reading materials by Vibal Publishing House, Inc. (VPHI) is exempt from the payment of the tax on business of printing and publication. EaHATD Representations are made that VPHI is engaged in publishing and printing of pre-school, elementary and high school textbooks/references materials that adhere to the prescribed curriculum of the Department of Education. Said request is being made invoking the provisions of Section 136 of the Local Government Code (LGC) of 1991, quoted as follows: "Section 136. Tax on Business of Printing and Publication . The province may impose a tax on the business of persons engaged in the printing and/or publication of books, cards, posters, leaflets, handbills, certificates, receipts, pamphlets, and others of similar nature, at a rate not exceeding fifty percent (50%) of one percent (1%) of the gross annual receipts for the preceding calendar year. "xxx xxx xxx. "The receipts from the printing and/or publishing of books or other reading materials prescribed by the Department of Education, Culture and Sports as school texts or references shall be exempt from the tax herein imposed." In view of the aforequoted provision, VPHI shall be considered exempt from the tax on business of printing, publishing and sale of school texts/reading materials that the local government may impose under Section 136 of the Code. However, VPHI shall be liable to pay the Mayor's permit and other regulatory fees or service charges that the local government concerned may have imposed under a duly-enacted tax ordinance, its exemption being applicable only to local tax. Very truly yours, (SGD.) MA. PRESENTACION R. MONTESA Executive Director