Bureau of Local Government Finance Opinion

December 26, 2000 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION 2nd Indorsement Respectfully returned to the Regional Director for Local Government Finance, Region VII, 3rd Floor, BF Building, N. Escarion Street, Cebu City, the herein preceding indorsement. This refers to the letter dated October 19, 2000 of the Assistant City Treasurer and In-Charge of Office, Office of the Treasurer, Dumaguete City, relative to the exemption from business taxes as claimed by the Management of Siliman University Bookstore, allegedly being a private, non-stock, non-profit educational institution. The ICO claims that SU Bookstore secured its business permit way back in February 1997. Though SU Bookstore is located within the premises of Siliman University, it does not offer exclusive services to its students and staff but also caters to the entire population of the community and is competing with other bookstores operating within the city. The ICO claims further that it can not also be considered as non-profit institution because books and other school supplies are sold to constituents with a profit. That Office affirms the contention of the said Treasurer that the SU Bookstore should declare the entire gross sales/receipts of the preceding year instead of declaring only what is derived from the bidding activities, as a basis for the computation of business taxes. ESDHCa In this connection, it is informed that this Bureau has consistently expressed the view that when a school maintains a bookstore within its premises, it is for the exclusive use of its students, faculty members and employees and therefore, it can not be concluded that it is engaged in business. In the above case, the ICO should require SU Bookstore to record its sales separately for the purpose of computing the tax due on the sales made other than those made within the university. Be guided accordingly. (SGD.) BENJAMIN A. GERONIMO Executive Director <http://www.blgf.gov.ph/downloads/opinion/localtax/2000/a2000-1207.pdf> last visited on October 2, 2013.