VAT Ruling No. 045-92

March 26, 1992 VAT RULING NO. 045-92 NIRC Sec. 102 (a) Precedent Ruling 046-91 Pinkerton Security & General Services, Inc. Posadas Commercial Complex Posadas Subd., Sucat Muntinlupa, Metro Manila Attention: Mr. David T. Pabalan Executive Vice President/Gen. Manager Gentlemen : In reply to your letter dated April 19, 1991 please be informed that as an Agency engaged in the business of selling security and general services, you are subject to 10% value-added tax based on your quarterly gross receipts. The term "gross receipts" means the total amount of money or its equivalent representing the contract price, compensation or service fee, including the amount charged for materials supplied with the services, and deposits or advance payments actually or constructively received during the quarter for the services performed or to be performed for another person, excluding value-added tax. (See Sec. 102(a), NIRC, as amended by E.O. No. 273) The said express statutory definition does not allow deduction of any expense, whether the same be for salaries of security guards and other personnel or for the cost of your purchases of materials supplied with the services. This Office regrets it has no legal basis to grant your request for deduction of expenses from your gross receipts for VAT purposes. EHcaAI Very truly yours, (SGD.) JOSE U. ONG Commissioner of Internal Revenue