Revenue v. Constantino

J.B.L., J.:

Appeal from the decision of the Court of Tax Appeals, in its CTA Case No. 1016, holding that the respondent, Cirilo D. Constantino, is not a commercial broker, as defined by Section 194(t) of the National Internal Revenue Code, providing as follows: "Commercial broker" includes all persons, other than importers, manufacturers, producers, or bona fide employees, who, for compensation or profit, sell or bring about sales or purchases of merchandise for other persons or bring proposed buyers and sellers together, or negotiate freights or other business for owners of vessels or other means of transportation, or for the shippers, or consignors or consignees of freight carried by vessels or other means of transportation. The term includes commission merchants.

and declaring him not liable to pay the commercial broker's percentage tax. Petitioner Commissioner of Internal Revenue assessed against and demanded from respondent Constantino the commercial broker's percentage tax of 6% on his gross compensation for 1956, as dealer or distributor of the products of International Harvester, Macleod, Inc. (IHM for short). The tax was computed as follows: Total discount for 1956 P38,390.40 6% broker's percentage tax due thereon 2,303.4 25% surcharge 575.85 Compromise penalty 100.00