VAT Ruling No. 054-01

August 15, 2001 VAT RULING NO. 054-01 Sec. 109 VAT Ruling No. 022-2000 Juriz Enterprise Better Living Subdivision Annex 31 Paraaque City Attention: Mrs . Juliet Angara M a d a m : This refers to your letter dated May 2, 2001 requesting for a ruling that you are exempt from the payment of VAT pursuant to Section 109(y) and from the 3% percentage tax under Section 116, both of the Tax Code of 1997, since your company is engaged in the business of selling books and magazines. In reply, please be informed that under Sec. 109, par. (y) of the Tax Code of 1997, the 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 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 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. (VAT Ruling No. 022-2000 dated June 23, 2000) This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. STcAIa Very truly yours, Commissioner of Internal Revenue By: (SGD.) EDMUNDO P. GUEVARA Deputy Commissioner Legal and Inspection Group