BIR Ruling

January 23, 1969 11th Indorsement Respectfully returned to the Honorable, the Undersecretary of Finance, Manila, the within papers relative to his 10th Indorsement dated December 12, 1968, bearing on the 9th Indorsement dated November 25, 1968, bearing on the 9th Indorsement dated November 25, 1968 of the Secretary of Foreign Affairs requesting interpretation of Section 22(f) of the Host Agreement concluded between the Republic of the Philippines and the World Health Organization, in relation to Section 22(g) of said Agreement. cdi This Office has interpreted Section 22(g) Article VIII of the Hose Agreement between the Republic of the Philippines and the World Health Organization to the effect that WHO officials who sell their personally-owned automobiles to non-exempt persons after three years following the date of importation, are exempt from the payment of customs duties only but not from the payment of compensating and other taxes considering that the term "duties" does not include taxes. In this connection, this Office is of the opinion that the same interpretation should be made with respect to Section 22(f) of the Agreement, which is quoted hereunder: "(f) have the right to import free of duty their furniture and effects at the time of taking up their post in the Republic of the Philippines or upon their permanent appointment to it; . . . " The exemption mentioned in the above-quoted provision refers also to customs duties only. Likewise, it cannot be construed to extend to internal revenue taxes. Hence, importations of furniture and effects and automobiles by WHO officials should no longer be allowed to be removed from customs without pre-payment of the compensating tax due thereon. cdtech Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue