Land Transportation Office, Regional Office No. IV-A

February 17, 2017 BIR RULING NO. 059-17 Section 101 (A) (2) and 101 (B) (1) of the NIRC of 1997, as amended; BIR Ruling No. 219-2016; BIR Ruling No. 437-2015 Land Transportation Office, Regional Office No. IV-A J.C. Abadilla Memorial Building, Old City Hall Compound, B. Morada Ave., Lipa City Attention: Eric Lenard E. Tabaldo, CESO V Regional Director Gentlemen : This refers to your letter dated November 24, 2015, received by this Office on December 15, 2015, requesting exemption from payment of donor's tax on the donation of two vehicles made between the INTERNATIONAL RICE RESEARCH INSTITUTE (hereinafter referred to as the " DONOR ") in favor of the LAND TRANSPORTATION OFFICE, REGIONAL OFFICE NO. IV-A (hereinafter referred to as the " DONEE "). HESIcT It is represented that the DONOR is an international organization with principal offices at Los Baos, Laguna; that it is the absolute owner of two used vehicles, more particularly described as follows: Make & Type - 2003 Toyota Revo Wagon Motor No. - 7K-0569732 Chassis No. - KF82-6004694 Plate No. - OEV-22844 CR No. - 88046526 OR No. - 698864493 Body No. - J-143 and Make & Type - 2001 Toyota Corolla Gli 4Dr Sedan Motor No. - 4A-J059002 Chassis No. - AE111-9572946 Plate No. - OEV-21887 CR No. - 74073284 OR No. - 746875754 Body No. - C-627 that on the other hand, the DONEE is a government institution with principal address at J.C. Abadilla Memorial Building, Old City Hall Compound, B. Morada Avenue 4217, Lipa City; that on November 23, 2015, the DONOR ,represented by its Director General ,Dr. Robert S. Zeigler, executed a Deed of Donation in favor of the DONEE ,represented by its Regional Director-Region IV-A ,Mr. Eric Lenard E. Tabaldo, CESO V, conveying to the latter the above described vehicles; and that the DONEE accepted the donation under the conditions set forth as embodied in the same instrument. AcICHD In reply, please be informed that Section 101 (A) (2) and 101 (B) (1) of the National Internal Revenue Code (NIRC) of 1997, as amended, provides that: " SEC. 101. Exemption of Certain Gifts. The following gifts or donations shall be exempt from the tax provided for in this Chapter: (A) In the Case of Gifts Made by a Resident. xxx xxx xxx (2) Gifts made to or for the use of the National Government or any entity created by any of its agencies which is not conducted for profit, or to any political subdivision of the said Government; xxx xxx xxx (B) In the Case of Gifts Made by a Nonresident not a Citizen of the Philippines. (1) Gifts made to or for the use of the National Government or any entity created by any of its agencies which is not conducted for profit, or to any political subdivision of the said Government. xxx xxx xxx" In view of the foregoing, since the donation is made to or for the use of the LAND TRANSPORTATION OFFICE, REGIONAL OFFICE NO. IV-A , which is a government institution under the Department of Transportation and Communications, the aforementioned donation of two vehicles is exempt from the payment of donor's tax pursuant to Section 101 (A) (2) and 101 (B) (1) of the NIRC of 1997, as amended. (BIR Ruling No. 437-2015 dated December 23, 2015) Also, the Deed of Donation is not subject to the documentary stamp tax prescribed under Section 196 of the NIRC of 1997, as amended, but only to the documentary stamp tax of P15.00 imposed under Section 188 of the same Code. However, if the purchase of the subject vehicles by the INTERNATIONAL RICE RESEARCH INSTITUTE was previously exempted from VAT and ad valorem tax (excise tax),the LAND TRANSPORTATION OFFICE, REGIONAL OFFICE NO. IV-A , not being exempt from the same, shall pay the VAT and the excise tax due on the transaction pursuant to Section 107 (B) of the NIRC of 1997, as amended, and Section 8 of Revenue Regulations No. 25-2003, respectively. caITAC This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be ascertained that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) CAESAR R. DULAY Commissioner of Internal Revenue