November 10, 1994
Ponente: Mendoza, J.
FACTS
The CIR issued RMC 49-9, which reclassified copra from §103b, where the sale of agricultural food products in their original state is exempt from VAT at all stages of production or distribution regardless of who the seller is, to §103a, where the sale of agricultural nonfood products in their original state is exempt from VAT only if the sale is made by the primary producer or owner of the land from which the same are produced.
The reclassification had the effect of denying to Misamis Oriental Association of Coco Traders the exemption it previously enjoyed when copra was classified as an agricultural food product under §103b of the NIRC.
RULING
The SC ruled for the CIR.
As the government agency charged with the enforcement of the law, the opinion of the Commissioner of Internal Revenue, in the absence of any showing that it is plainly wrong, is entitled to great weight.
Indeed, the ruling was made by the Commissioner in the exercise of his power under §245 of the NIRC to “make rulings or opinions in connection with the implementation of the provisions of internal revenue laws, including rulings on the classification of articles for sales tax and similar purposes.”
