Articles Subject to Compensating Tax

March 6, 1979 BIR RULING NO. 007-79 Articles subject to compensating tax This refers to your letter dated December 2, 1973 requesting permission to clear from customs custody without the pre-payment of internal revenue taxes on your shipment as follows: "295 Packages Hardware on board ELBE EXPRESS B/L No. LB/MLA C-1 from Los Angeles STAMLA November 29, 1978" on the ground that the said materials are to be exclusively used by you as a non-profit foundation which is exempt from the payment of income tax pursuant to Section 27(c) of the Tax Code. In reply thereto, I regret to inform you that your request cannot be granted. Section 204 of the Tax Code of 1977, as amended by P.D. No. 1457 enumerated the articles which are not subject to compensating tax and those imported by non-profit institutions are not included in said enumeration. It follows that the above mentioned articles imported by you are subject to compensating tax.