BIR Ruling No. 033-63

April 2, 1963 BIR RULING NO. 033-63 Mr. Maximo Pleno c/o Mayon Ceramics Corporation P.O. Box 1900, Manila S i r : Reference is made to your letter dated January 8, 1963 requesting information as to whether or not the income to Japanese technicians rendering personal service to your company under the Reparation Agreement between the Philippines and Japan, is exempt from income tax in the Philippines. cdll In reply thereto, I have the honor to inform you that Article 9, Section 4 of the Reparations Agreement between the Philippines and Japan, as ratified by the Philippine Senate Resolution No. 78 Third Congress Third Special Session, provides: "With reference to the income derived from the supply of services or products under the present Agreement, Japanese nationals and juridical persons shall be exempt from taxation in the Philippines." Said provision exempts income of Japanese nationals derived from the supply of services under the Reparations Agreement. Inasmuch as Section 29(b)(6) of the Tax Code excludes "income of any kind, to the extent required by any treaty obligation binding upon the Government of the Philippines", it is believed that the income of Japanese technicians rendering service to your company is exempt from income tax in the Philippines. It must be emphasized, however, that the income exempt from tax is that derived from services under the Reparations Agreement. Income derived by Japanese nationals for services rendered outside of the Reparations Agreement is taxable. llcd Very truly yours, (SGD.) JOSE B. LINGAD Acting Commissioner of Internal Revenue