BIR Ruling [DA-448-99]

August 4, 1999 BIR RULING [DA-448-99] Embassy of the United States of America Manila Attention: Mr . Victor E . Myev Second Secretary Gentlemen : This refers to your Note Verbale No. 1216 dated December 17, 1998, which was referred to this Office by the Office of Protocol, Department of Foreign Affairs, relative to your request for exemption from the payment of Value Added Tax (VAT) and Ad Valorem Tax for the purchase of one (1) unit 1998 Toyota Tamaraw Revo for the personal use of Mr. Joseph T. McGee, Deputy Executive Officer, USAID, of the Embassy. cdlex In reply thereto, please be informed that under the principle of reciprocity, this Office may grant tax exemption to the Embassy of a foreign state and its personnel on their local purchase of goods and services provided that they can submit to the Commissioner of Internal Revenue or his duly authorized representative a copy of the special legislation or international agreement showing that said foreign government allows similar tax exemption to the Philippine Embassy or its personnel on their purchase of goods or services in that foreign country. (BIR Ruling No. 206-73 dated May 11, 1993) Thus, upon the certification by the Department of Foreign Affairs that indirect tax (i.e., value added tax and ad valorem tax) exemption is granted to the Philippine Embassy and its personnel in a particular host country, the same privilege will also be accorded to the latter's Embassy and its personnel in the Philippines. Such being the case, since the Department of Foreign Affairs has recommended a favorable action on the basis of reciprocity to the request for exemption from the payment of the VAT and ad valorem tax on the local purchase by the Embassy of one (1) unit of 1998 Toyota Tamaraw Revo for the personal use of Mr. Joseph T. McGee, the sale of said vehicle shall be exempt from VAT and ad valorem tax imposed under Sections 106(A) and 149 of the Tax Code of 1997, respectively. (BIR Ruling No. DA-527-98 dated November 25, 1998) LexLib 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. Very truly yours, Commissioner of Internal Revenue By: (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner (Legal & Enforcement Group)