BIR Ruling

December 8, 1976 Dr. Benjamin Cer. Gabriel, PH.D. 1347 Lardizabal, Sampaloc Manila 2806 S i r : This refers to your letter dated December 1, 1976 reiterating your request for a waiver of the requirement of Presidential Decree No. 439 that payment for the purchase of a locally manufactured automobile tax-free be made in United States currency and that you be given a special consideration to buy a locally manufactured car tax-free in Philippine currency. It appears that you are an awardee of Balik-Scientist Program Phase II under Presidential Decree No. 819; that you and your wife are natural born citizens of the Philippines who have stayed in United States for more than 5 years and are now in the Philippines to live permanently; that you are now employed as a senior researcher in Southeast Asian Fisheries Development Center, Binangonan Freshwater Aqua-culture Station Rizal; that in your return trip to the Philippines, you have advanced all expenses in United States currency for airline tickets, shipping of personal effects and other incidentals; that upon your arrival in the Philippines, the Philippine government through the National Science Development Board refunded to you all said expenses in Philippine pesos and not in U.S. dollars; and that the Philippine government did not use any foreign exchange for your return. In reply, I have the honor to inform you that pursuant to the provisions of Presidential Decree No. 819, any foreign-based scientist, technician, or professional, or any person with special skill or expertise who is a Filipino or of Filipino origin or descent and the members of his/her family, who is licensed to practice his/her profession, special skill or expertise and while staying in the Philippines may avail of the incentives, benefits and privileges being enjoyed by overseas homecoming Filipinos (Balikbayans) under existing decrees for the duration of the Balik-Scientist Program. Accordingly, since you are an awardee of the Balik-Scientist Program under P.D. 819, you are entitled to the benefits and privileges granted under Presidential Decree No. 439 which governs the Balikbayan Program. However, Section 2 of Presidential Decree No. 439, provides: "SEC. 2. Provisions of Sections 184; 184-A; 185; 185-A; 185-B; 186; 186-A; and 186-B of the Internal Revenue Code, as amended, to the contrary notwithstanding, Overseas Filipinos as herein defined who are coming to settle permanently in the Philippines may purchase locally manufactured vehicles, household appliances, professional instruments and other tools of trade, occupation or employment, free of internal revenue taxes; Provided: "a. Such items are purchased from authorized dealers and are brand new; "b. In the case of vehicles, that the same are registered under the Progressive Car Manufacturing Program; "c. . . . "d. That the purchases are made locally and in United States currency ; "e. That the purchases are made within a period of six (6) months from date of arrival ." (Emphasis ours) This Office has no authority or discretion to waive either of the abovementioned requirements governing the purchase tax-free of a locally manufactured car by a Balik-Scientist under Presidential Decree No. 439 in relation to P.D. 819. Accordingly, unless all of said requirements are complied with, your request to purchase tax-free a locally manufactured car has to be, as it is hereby, denied. aisa dc Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3