Interpretation of Sec. 183 (b)

January 8, 1958 BIR RULING NO. 017-58 Mr. A. A. Agleham 841 Isabel, Sampaloc, Manila S i r : In answer to the queries contained in your letter dated November 9, 1957, I have the honor to inform you as follows: The "Tax Code" alluded to in our letter to you of October 22, 1957 is the National Internal Revenue Code which has been in force and effect since July 1, 1939. Certain provisions of said Code, however, had undergone several amendments. If you own or possess a copy thereof with amendments thereto up to August 24, 1956, which is the latest print of the Bureau of Printing, you will find Section 183(b) therein. By "Section 183(b)", we mean Section 183, paragraph (b) of the same Code. llcd This Office has always ruled that automobiles brought or imported into the Philippines tax-free by persons, agencies or entities exempt from tax are, when sold or transferred therein to non-exempt persons or entities, or exchanged for other articles belonging to the latter, subject to the compensating or advance sales tax, depending upon whether the same will be used personally or sold by the vendee or recipient of the automobile is considered the importer thereof and, therefore, the one liable for the tax (General Circulars Nos. V-145 & V-152). Such ruling was subsequently confirmed by Republic Acts Nos. 1511 and 1612, which amended Sections 183(b) and 190 of the Tax Code and took effect on June 16, 1956 and August 24, 1956, respectively. Automobiles, therefore, sold, transferred or exchanged under the abovementioned circumstances are taxable, even if the transaction took place before the operation of Republic Acts Nos. 1511 and 1612. Republic Act No. 1603, which amended certain provisions of the Motor Vehicle Law (Act No. 3992) is merely a provision to ensure collection of the taxes due on the aforesaid automobiles. This amendatory Act took effect on August 23, 1956, the date it was approved. Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue