BIR Ruling [DA-019-99]

January 11, 1999 BIR RULING [DA-019-99] Vicente Sotto Memorial Medical Center B. Rodriguez Street Cebu City 6000 Attention: Dr . Eusebio M . Alquizalas, M . D . , FPOGS, FPCS, M . M . Medical Center Chief Gentlemen : This refers to your letter dated December 2, 1998 stating that you are the recipient of a donated assorted medical supplies and equipment from the World Medical Relief of Michigan, U.S.A.; and that the said donations arrived on November 1, 1998 at the Cebu International Port and you are paying for the storage and demurrage fees. prll In the light of the foregoing, you now request for exemption from customs duties and value added tax on the importation of the aforementioned assorted medical supplies and equipment from abroad. In reply, please be informed that the above request cannot be granted for lack of legal basis. The importation of assorted medical supplies and equipment from foreign institutions is subject to 10% VAT based on the total value used by the Bureau of Customs in determining tariff and customs duties, plus customs duties, excise tax, if any, and other charges, such tax to be paid by the importer prior to the release of such goods from customs custody pursuant to Section 107(A) of the Tax Code of 1997. However, said importation is exempt from the donor's tax if it is donated to a non-stock, non-profit corporation subject to the condition that not more than 30% of said gift shall be used by the donee foundation for administration purposes in accordance with Section 101(A)(3) of the Tax Code of 1997, in relation to Section 104 of the same Code. (BIR Ruling No. 110-91 dated June 18, 1991) This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. LLpr Very truly yours, Commissioner of Internal Revenue By: (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner (Legal and Enforcement Group)