REVENUE MEMORANDUM CIRCULAR NO. 73-2007 issued on November 15, 2007 re-issues the guidelines on the proper treatment of block sale of sales of stock disposed of in the Stock Exchange.

        The sale of shares of stock where the sale is prearranged or the buyer/s is predetermined is taxable under either Section 24(C); Section 25(A)(3); Section 25(B); Section 27(D)(2); Section 28(A)(7)(c) or Section 28(B)(5)(c) of the Tax Code, as amended, notwithstanding the fact that the transaction passed through the Stock Excha nge or the said facility was used.

        Any transaction, which in effect excludes the public by any means from taking part in the trading, shall be taxed under the aforementioned relevant provisions.

        The Circular expressly covers, but is not limited to cases of block sale , which is defined in the implementing rules and regulations of the Securities Regulation Code as a matched trade that does not go through the automated order matching system of an Exchange trading system but instead has been prearranged by and among the Broker Dealer’s clients and is then entered as a done deal directly into the trading system.