Exemption of the Prize in the Raffle Draw from Income Tax

August 9, 1990 BIR RULING NO. 146-90 21 (c) (2) 24 000-00 146-90 Gentlemen : This refers to your letter dated May 3, 1990 to the Acting Director General for Protocol, Department of Foreign Affairs, which was referred to this Office for a ruling as to whether your prize in the raffle called "The Handog Pang-Tindahan" sponsored by Kimberly Clark Philippines consisting of one (1) Lancer 1300 EL is exempt from the 20% withholding tax. cdta Documents submitted show that you are an international organization based in Geneva; that on July 15, 1988, you entered into a Memorandum of Agreement with the Philippine Government, the tax exemption clause of which provides that you will enjoy the same tax benefits enjoyed by a specialized agency of the United Nations. In reply, please be informed that since the aforesaid Memorandum of Agreement between you and the Philippine Government specifically stipulates that you, your property, funds and assets shall enjoy the privileges in accordance with the Convention on Privileges and Immunities of the Specialized Agencies of the United Nations adopted on November 21, 1947; and since the tax exemption clause of the latter states: "SEC. 9. "The Specialized Agencies, their assets, income and other property shall be: (a) Exempt from all direct taxes" your prize in the raffle draw conducted by Kimberly Clark Philippines consisting of one (1) unit Lancer 1300 EL is exempt from income tax imposed under Section 24 of the Tax Code and consequently, from the withholding tax. aisadc Very truly yours, (SGD.) JOSE U. ONG Commissioner