JMM Co. is a domestic corporation operating toll facilities by virtue
of a franchise. It held in trust for the
Government certain shares in various subsidiaries and joint venture companies. In view of the expiration of its franchise in
1997, P Co. was ordered by the Supreme Court to transfer the said shares in
favor of the Government.
Being made without monetary consideration and merely for confirmation
of title / ownership in favor of the Government as beneficial owner, the BIR
held that transfer is not subject to Capital Gains Tax imposed under Section
27(A) and (D)(2) of the Tax Code.
Likewise, the BIR opined that no donor’s tax is applicable since the
transaction was made without intent to do an act of liberality on the part of
the transferor and merely in compliance with a Supreme Court decision. Further, the transfer is subject to the DST
on certificates under Section 188 of the Tax Code, not to the DST on sales, or
agreements to sell, or transfer of shares or certificates of stock.
Accounting Times, Vol. 62 No. 4, June 2012
Walang komento:
Mag-post ng isang Komento