importation of One (1) Unit Mitsubishi Passenger Elevator from Japan thru Its Domestic Agent, the International Elevator Equipment, Inc., Not Exempt from Taxes (obviously VAT) and Duties Pursuant to the 1987 Philippine Constitution

March 16, 1995 BIR RULING NO. 055-95 103 000-00 055-95 Saint Paul College of Paraaque Paraaque, Metro Manila Attention: Sr . Maria Lirio Gavan Finance Officer Gentlemen : This refers to your letter dated December 1, 1994, requesting that your importation of one (1) unit Mitsubishi Passenger Elevator from Japan thru its domestic agent, the International Elevator Equipment, Inc., valued at the cost of $21,240.00 to be delivered before March, 1995, be exempt form taxes (obviously VAT) and duties pursuant to Article 14, Section 4, paragraph 3 of the 1987 Philippine Constitution. In reply, please be informed that your aforesaid request cannot be granted for lack of legal basis. Section 103 of the Tax Code, as amended by E. O. No. 273, which enumerates the transactions exempt for VAT does not include importations of elevators even if they are consigned to non-stock, non-profit educational institutions like you. Moreover, the aforecited Constitutional provision cannot be invoked by you because elevators cannot be considered as assets of an educational institution which are used actually, directly and exclusively for educational purposes. In fact, most educational institutions operate even without elevators. As regards your request for exemption from customs duties on your aforesaid importation, it is suggested that you direct the same to the Commissioner of Customs who has jurisdiction on the matter. Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue