VAT Ruling No. 022-00

June 23, 2000 VAT RULING NO. 022-00 109 (z) 109 (y) 386-87 285-88 Global Publishing 1317-D Masangkay St. Sta. Cruz, Manila Attention: Mr . Winston Lim Owner Gentlemen : This refers to your letter dated June 7, 2000 requesting for a ruling as to whether you are still required to pay the 3% percentage tax under Sec. 116, in relation to Sec. 109(z), both of the Tax Code of 1997, not withstanding the fact that your company is engaged in the publishing and selling of books which is a VAT exempt transaction under the same Code. In reply, please be advised of the following: Under Sec. 109, par. (y) of the Tax Code of 1997, sale, importation, printing or publication of books and any newspaper, magazine, review or bulletin, which appears at regular intervals with fixed prices for subscription and sale and which is not devoted principally to the publication of paid advertisements, is exempt from the imposition of the Value-Added Tax. As such, regardless of the amount of the said transaction, it will not be subjected to the Value-Added Tax, neither will it be required to pay the 3% percentage tax under Sec. 116, in relation to Sec. 109 (z) of the same Code. In view thereof, your business of publishing and selling of books is exempt from the payment of the Value-Added Tax and from the 3% percentage tax. However, if you have other transactions (such as the printing of brochures), which are subject to the Value-Added Tax, you will also be required to register your business as a VAT business entity and issue a separate VAT invoice/receipt to record such transactions. This ruling is being issued on the basis of the foregoing facts as represented. If upon investigation, it will be discovered that the facts are different, then this ruling shall be considered null and void. IEcaHS Very truly yours, (SGD.) LILIAN B. HEFTI Deputy Commissioner Legal and Inspection Group