BIR Ruling

February 18, 1977 The Executive Director Overseas Employment Development Board Department of Labor Phoenix Bldg., Intramuros Manila S i r : This refers to your letters dated June 25, 1976 and August 9, 1976 seeking reconsideration of our denial of your request that the certificates of tax clearance procured by Filipino Medical Workers who were recruited thru the Overseas Employment Development Board (OEDB) on a government-to-government arrangement by the Imperial Government of Iran and the Federal Public Services Commission of Nigeria be utilized even after the 60-day period required under existing regulation. In reply, I regret to inform you that your request for reconsideration cannot be granted for lack of legal basis. A certificate of tax clearance must be secured by any citizen of the Philippines contemplating to leave the country. (Sec. 2, Revenue Regulations No. 19-67) It is clear, therefore, that it is the person who intends to leave the country who is required to procure a tax clearance certificate and the fact that payment of the tax clearance certificate is made by that Board does not make it the Board's personal liability. It is an elementary rule in taxation that an exemption is a personal privilege which may be enjoyed solely by the grantee. The exemption from tax granted to government instrumentalities and agencies through which the government exercises sovereign powers refer only to taxes to which the government instrumentality is directly liable. cdti In accordance with Section 4 of Revenue Regulations No. 19-67 dated May 2, 1967, a tax clearance is valid only for 30 days from the date of issuance but can be extended once for another 30 days only upon proper application after which said clearance becomes null and void. Such being the case, since the 60-day period had already expired, the Filipino workers concerned were required to secure new certificates of tax clearance. Consequently, the total amount of P18,278.00 paid on the said new certificates secured by them was collected in accordance with law, in which case, your request for the refund thereof cannot be allowed. Very truly yours, EFREN I. PLANA Acting Commissioner of Internal Revenue TAN-1456-040-3