Fh::-T"\1 C of the Philippl~I·.8 < Ol Rt of Tax Appeals Quezon Clty Institutional Food Services, Inc vs. C. T. L.O Case No. 2354 Tile Cohhission~R of Internal Revenue, ·

DECISION

Petitioner , a corporation filing its income tax returns on the calendar year basis , was required by respondent to pay the sum of ?1 ,163 . 68 , as deficiency income tax and delinquency penalties for the year

1968 .

The deficiency assessment is the result of the application , effective July 1, 1968 , of the new corpo- rate income tax rates of 25% a~d 35% prescribed in Republic Act No . 5431 , v1hich increased the old rates provided in Section 24 of the Revenue Code o Section 10 of Republic Act No . 5431 provides that the ne\v rates of corporate income t ax prescribed in said ct 11shall apply to income for taxable year s beginning after June 30 , 196811 • ... s petitioner is fil- ing its income tax returns on the calendar year basis , the ne1 .. 1 rates of corporate income tax should apply to its income begilming January 1, 1969 and not July 1,

1968 .

Ho"tvever , respondent contends that the ne1.v rates of corporate income tax should apply to income of all corporations effective J"uly 1, 1968 , VThether or not they are calendar year or fiscal year corporations . The issue raised is not one of fi:sst impressiono

DECioiON -

CT~ C oE NO o 2354 2 In several cases involving the same issue , it \vas held that the increased rates prescribed in Republic 11.ct No . 5431 are applicable to income of calendar year corpora- tion beginning January 1, 1969 and not July 1 , 1968 as interpreted by respondent . (The Hanila Times Publishing Co . , Inc . v. Commissioner of Internal Revenue , CoToAo Noo 2263J December 17 , 1973 , certiorari denied in GoR . No .. L- 38154 , Hay 10 , 197L1-; Zamboanga \.Iood Products, Inc o v .. CoL®issioner of n1ternal Revenue , C. T ... No., 2053 , June 3 , 1974; Colgate Palmolive Phil .. , Inc .. v. Commissioner of Internal Revenue , C .. T ..

. No . 2293 , June 10, 1974; Philo 1 viation Corp . v. Commissioner of Internal Revenue , C. Tol .. Ho . 2195 , .H.Ugustt5 , 1974-; First Insular Bunk of Cebu v .. The Com.rn.issioner of Internal Revenue , C. T .. Ao No . 2262 , august 29 , 1974; Tabacalera Insurance Co ., L1c . Vo Com- missioner o.f Internal Revenue , C. T ... Noo 2081 , November 20 , 1974. )

dlli:RE.ttOHE , the decision appealed from is hereby reversed ., No costs o SO ORDZRLD ..

uezon City , February 19 , 1975.

-~~~~,€__ RON .. ~N M o uu~IJ)

Presiding

Judge