October 29, 2004
VAT RULING NO. 031-04
Sec. 109 (j) (z)
PEJG Shuttle Bus Service
209 M.L. Quezon Street, Lower Bicutan
Taguig, Metro Manila
Attention: Estrella D. Capiz
Proprietress
Gentlemen :
This refers to your letter dated November 5, 2003 requesting clarification as to whether your company is still subject to the three percent (3%) tax as transportation contractor or shall be reclassified as a value-added taxpayer, since your gross annual receipts exceeded the P550,000.00 threshold provided for under Section 109(z) of the Tax Code of 1997.
It is represented that your company, PEJG Shuttle Bus Service (PEJG), is a single proprietorship engaged in the business of transportation service; that your company provides air-conditioned and non air-conditioned buses for the exclusive use of the employees of your client companies; that in consideration for the said services, your clients pay a specific amount per trip computed depending upon the route specified; that your client companies deduct 2% from your gross billings representing the withholding tax due by your company as a transportation contractor; that you pay the salaries of your drivers and dispatchers and maintain...
