BIR Ruling

July 27, 1970 Mr. Henry Q. Enrique Lingayen, Pangasinan S i r : This refers to your letter dated July 21, 1970 requesting exemption from the payment of compensating tax on a 1965 Ford Custom 500 4 door sedan car, refrigerator, freezer, washer automatic, television set, tape recorder, sewing machine, 3 electric fans, dry iron and electric stove brought in by you as tax-free while you were in the active service of the U.S. Navy. In reply, I have the honor to inform you that inasmuch as you are an American citizen and since you acquired the aforesaid car and personal effects when you were qualified as a tax-exempt person under the provisions of the U.S.-P.I. Military Bases Agreement, your continued possession thereof for your personal use after your retirement from the naval services of the United States will not render you liable for the payment of the compensating taxes due thereon. It is understood, however, that should you sell the aforesaid car and/or articles to a non-exempt purchaser, the latter shall be subject to the corresponding internal revenue taxes. This will serve as authority for the Special Deputy Collector, Customs Subic Sub-Station, Olongapo City in releasing the aforesaid car and personal effects free from taxes. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue