Taxability of the Subsequent Sale of a Helicopter Already Subjected to Compensating Tax Upon Its Importation

May 5, 1992 BIR RULING NO. 139-92 100 (a) 000-00 139-92 Mr. Antonio V. Marquez District Collector Bureau of Customs NAIA, Metro Manila S i r : This refers to your letter dated April 6, 1992, in relation to a letter dated March 21, 1992 by the Corporate Secretary and counsel for Makati Development Corporation (MDC), in effect, requesting for a ruling that said corporation which imported one (1) Helicopter 350 B Ecurauil Serial No. 1145 in 1980 without having paid the customs duty (in view of the duty exemption granted under Presidential Memorandum No. 413-73 dated September 14, 1973 by NEDA under its Resolution No. 6, s. 1974); but having paid the compensating tax in accordance with the 1st Indorsement of the Acting Minister of Finance dated February 8, 1980, is no longer subject to VAT imposed on the subsequent sale of the aircraft to the purchaser who is considered the importer thereof pursuant to Section 101(b) of the Tax Code. In reply, please be informed that since the aforesaid helicopter was already subjected to compensating tax upon its importation and release from customs custody in 1980 pursuant to then Section 204 of the Tax Code; upon its subsequent sale, it being an asset in the business of a VAT-taxable person, the sale thereof is subject to 10% VAT based on its gross selling price pursuant to Section 100 (a) of the same Code. Very truly yours, EUFRACIO D. SANTOS Deputy Commissioner Officer-in-Charge