Taxability of Imported Cherokee Jeep for Excise Tax Purposes

April 13, 1998 BIR RULING NO. 032-98 149-000-00-32-98 Mr. Antonio G. Cadavero, Sr. Revenue District Officer Revenue District No. 80 Mandaue City S i r : This refers to your 1st Indorsement dated November 28, 1997 requesting information regarding the taxability, for excise tax purposes, of imported Cherokee Jeep. prLL It appears that the Board of Investments (BOI) had authorized Transfarm & Co., Inc. of Mandaue City to import 570 units of vehicle some of which are Cherokee Jeep; that per report dated November 28, 1997 of the Chief, Excise Tax Unit of that District, 103 units of different vehicles had arrived, 61 units of which are still in Customs custody while 42 units are in a Bonded Warehouse under the joint custody of the Bureau of Customs and the importer; and that as of that date (November 28, 1997) no withdrawal of the said imported vehicles has been made, hence, no excise tax has been paid although the corresponding VAT has been collected by the Bureau of Customs at the Port of Cebu City. In connection therewith, you are informed that the Presidential Memorandum of May 23, 1995 which granted the request of Philmotors Corporation for the classification of Cherokee Jeep as "Jeep" not subject to excise tax was authorized for market test purposes only . The fact that the restriction on the number of imported Cherokee Jeep for market testing purposes has been lifted by the BOI does not necessarily mean that the subsequent importation of Cherokee Jeep in excess of the quantity limit of 25 units is already exempt from the ad valorem tax. Absent a law exempting Cherokee Jeep from the ad valorem tax, no exemption will be granted by this Office. This is so, because exemptions from taxation are looked upon with disfavor and one who claims exemption from taxation must be able to justify his claim by the clearest grant of organic or statute law. Conversely, the intention to exempt must be expressed in clear and unmistakable language or must appear by necessary implication from the terms thereof. An exemption from the common burden cannot be permitted to exist upon vague implication, otherwise state revenues will suffer. (Western Minolco Corporation vs. CIR, 124 SCRA 121) In view of the foregoing, you are hereby directed to desist from issuing Authority To Release Imported Goods (ATRIG) to Transfarm & Co., Inc. on its importation of Cherokee Jeep unless and until the corresponding ad valorem tax imposed under Section 149 of the Tax Code of 1997 on the said importation has been fully paid. LexLib Very truly yours, (SGD.) LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue