BIR Ruling

December 1, 1972 Atty. Antonio M. Chavez Suite 210 Marvel Bldg. No. 1 Juan Luna, Manila S i r : This refers to your letter dated November 27, 1972 requesting clarification on the provisions of Presidential Decree No. 53. As a premise, you stated that the imported goods are in the hands of a local purchaser; but he bought the goods in the local market evidence by corresponding purchase invoices; that he does not know who the importers are; that he is not sure whether the importer, who ever he is, paid the corresponding taxes and duties or whether or not said goods were undervalued, misdeclared, or misclassified, or were smuggled outright. cdti Under the foregoing facts, you would like to be informed of the following: "1. If the goods are seized on suspicion that they are illegally imported and are, at present, under detention by the customs authorities, is there a need for him to pay the taxes and duties or should it be the importer? "2. If so, what will be the basis of payment? What will be the nature of the taxes and duties? How many percent? How much? "3. How about the goods now in the custody of a court by virtue of a search warrant issued on suspicion that the goods were illegally imported? "4. If payment is made under the tax amnesty decree, will the government entity concerned, either the customs authorities or the court, stop the proceedings and release the goods into the custody of the local purchaser?" In reply, I have the honor to quote hereunder the provisions of No. 1 of Presidential Decree No. 53, dated November 16, 1972, as amended by Presidential Decree No. 80, viz.: "That any importer, dealer, possessor or owner in commercial quantities of items, commodities, goods, articles or merchandise, the taxes, duties and/or other charges on which have been paid or not correctly paid because of misdeclaration, misclassification, under valuation and/or other fraudulent means shall be relieved of any penalty, surcharge, or increment incident thereto and of any criminal liability under the National Internal Revenue Code, Customs and Tariff Code or any other laws applicable thereto if twenty-five per centum (25%) of the correct taxes, duties and charges due thereon are paid in full on or before January 31, 1973, in final and complete settlement thereof, except motor vehicles which are covered by Presidential Decree No. 52 dated November 16, 1972, as well as articles subject to specific tax the tax on which has not been paid and violators with pending criminal, civil and administrative cases ." (Emphasis ours) From the foregoing, it is clear that owners of goods which are seized on suspicion that such goods were illegally imported, cannot avail of the tax amnesty under Presidential Decree No. 53, as amended. Similarly, owners of goods in the custody of a court by virtue of a search warrant issued on suspicion that the goods were illegally imported cannot avail of the aforequoted provision of Presidential Decree No. 53, as amended. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue