BIR Ruling No. 056-64

August 17, 1964 BIR RULING NO. 056-64 Del Rosario Bros. & Company 30 Naval St., Malabon Rizal Gentlemen : This refers to your letter dated June 11, 1964 requesting exemption from the payment of the compensating tax on the five (5) vessels, all named "Trinidad", which you imported from abroad, on the ground that they come within the purview of the tax exemption provided for in Section 190 of the National Internal Revenue Code, as amended by Republic Act No. 3176. cdta In reply thereto, I have the honor to inform you that, it appearing from the evidence submitted by you that the vessels in question are "fishing boats" which will be used in connection with your fishing industry, they do not come within the purview of the aforesaid tax exemption, which exempts from tax "articles to be used by the importer himself as a passenger and/or cargo vessel, whether coastwise or ocean going, including engines and spare parts of said vessels". It is clear from the aforequoted provision of the law that the vessels referred to therein are those to be used for transportation of passenger or cargo, the purpose being to encourage and help carriers who transport by water passengers or cargoes. In other words, the tax exemption is intended to benefit only shipping operators. The evidence on record show that the vessels in question are actually fishing boats and obviously, they will be used in the fishing industry and not in the business of a shipping operator. Such being the case, they do not come within the purview of the tax exemption provided for in Section 190, as amended by Republic Act No. 3176. cdti Very truly yours, (SGD.) BENJAMIN N. TABIOS Acting Commissioner of Internal Revenue