Resolution Concurring in the Ratification of the Convention the Philippines and Thailand for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income

October 6, 1961 BIR RULING NO. 452-61 In answer to your letter . . . , requesting exemption from the specific tax on the films, entitled: Tea Without Weeds and Rubber Without Weeds, I have the honor to inform you that it is now settled that where the educational quality of a film is but incidental to its main purpose of promoting or advertising the taxpayer's products, the same does not fall within the meaning of "educational films or cinematographic films used for visual education" exempt from the specific tax imposed in Section 146 of the National Internal Revenue Code. (Philippine Manufacturing Co. vs. Collector of Internal Revenue, G. R. No. L-13355, Jan. 28, 1961) Considering that, as you claim, . . . Basle, Switzerland, manufacturers of insecticides and agricultural chemicals, and whom you represent in the Philippines, was the one who sent you those films and considering further that they will be shown to agriculturists, planters and farmers, it is fair to assume that the same have for their main purpose the promotion or advertisement of your principal's products and whatever educational value they have is merely incidental to that purpose. Such being the case, and in the light of the pronouncement of the Supreme Court in the case cited above, it is regretted that your request for exemption has to be, as it hereby is denied. LLjur