Bureau of Local Government Finance Opinion

January 27, 1995 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION Mr. Pedro G. Frias, Jr. Administrative Officer The Mar y Cielo Resort Unit 10-B, 10th Floor JMT Corporate Condominium ADB Ave., Ortigas Center Pasig, Metro Manila S i r : This refers to your query dated January 17, 1995 regarding situs of taxation. Representations are made that The Mary Cielo Resort (TMCR) and its main office are both located in Lapu-Lapu City. It also maintains an office for purposes of collection and reservation in Pasig, Metro Manila. Further representations made under a letter dated January 25, 1995, show that said office in Pasig is being maintained purposely to follow-up receivables/collection which eventually are transmitted to the principal office in Lapu-Lapu. On the basis of the representations made by that Office, it appears that the office located in Pasig is a sales office inasmuch as the same does not accept reservations only but payments made by customers as well. Hence, the requirement of recording the sale in the sale office where the sale or transaction is made is mandatory pursuant to the provisions of Article 243 (b) of the Implementing Rules and Regulations (IRR) of the Local Government Code (LGC) of 1991, which reads as follows: ART. 243. Situs of the Tax. . . . "(b) Sales Allocation (1) All sales made in a locality where there is a branch or sales office or warehouse shall be recorded in said branch or sales office or warehouse and the tax shall be payable to the city or municipality where the same is located. "xxx xxx xxx." Accordingly, TMCR is deemed liable to the payment of business taxes to the municipality of Pasig and the City of Lapu-Lapu, as follows: 1. All sales made in Pasig shall be 100% taxable by Pasig where the sales office is located. 2. All sales made in Lapu-Lapu and receipts in the resort shall be 100% taxable by Lapu-Lapu where the principal office and resort are located. 3. Both the City of Lapu-Lapu and the municipality of Pasig may collect Mayors permit and other regulatory fees imposable under their respective duly enacted ordinances. Very truly yours, LORINDA M. CARLOS Executive Director