10% Compensating Tax on Open-Bed Chevy Blazer Vehicle

March 29, 1990 BIR RULING NO. 041-90 99 003-88 041-90 S i r : This refers to your letter dated February 1, 1990, in effect, requesting a ruling on how to tax the open-bed Chevy Blazer vehicle imported tax-free by Mr. Arsenio Nabas while he was in the active service of the U.S. Military Forces but retained by him after having retired from the service. Documents show that Mr. Nabas, is a Filipino citizen who joined the U.S. Air Force at Clark Air Base; that during his tour of duty as a member of the U.S. Armed Forces, he brought to the Philippines more than one vehicle without the payment of internal revenue taxes under and by virtue of the tax exemption provision in the U.S. Military Bases Agreement; that upon his retirement from the service, he had three (3) vehicles, one of which is the 1977 Chevy Blazer open bed utility truck; the other is a 1987 Dodge 4-Door sedan; and third is a 1986 Toyota truck. Since, Mr. Nabas already sold the 1986 Toyota truck to another person in the active service of the United States Military Base and that the 1987 Dodge 4-door Sedan was allowed to be retained by him tax-free even after his retirement from the service, you pose the question on how to tax the Chevy Blazer being retained by Mr. Nabas. In reply, please be informed that the tax on imported goods is determined by law in force at the time of release from Customs Custody. (BIR Ruling No. 99-24-86-003-88) In the instant case, since the aforesaid vehicle was released from Customs Custody on July 26, 1985, the applicable tax is the 10% compensating tax based on the landed cost of the vehicle without mark-up as provided under then Section 199, in relation to then Section 204 of the Tax Code. This serves as your authority to collect 19% compensating tax from Mr. Nabas. cdtech Very truly yours, (SGD.) JOSE U. ONG Commissioner