Request for a Tax Exemption Certificate and the Issuance of a BIR Depreciation Table for Motor Vehicles

November 18, 1994 BIR RULING NO. 157-94 149-00 101(b) 000-00 157-94 Asian Development Bank ADB Avenue, 1501 Mandaluyong Metro Manila Attention: Mr . N . Viswanathan Gentlemen : This refers to your letter dated August 27, 1993 requesting our assistance for a more expeditious issuance of a tax exemption certificate and the issuance of a BIR table of depreciation in connection with the availment of the second car privilege by the qualified staff of the Asian Development Bank. LexLib Since you have orally represented that the first issue was answered and the mechanics thereof are already being implemented to your satisfaction by Assistant Commissioner Bernardo Frianeza, who remains to be decided is the adoption of a table of depreciation for purposes of determining the internal revenue tax base of motor vehicles for internal revenue tax purposes. In reply, please be informed that pursuant to Sections 101(b) and 149 of the Tax Code, this Office has invariably applied the formula used by the Bureau of Customs in determining the tax liability of the importers from value-added and ad valorem taxes. In the case of tax-free importation of motor vehicles, for purposes of determining the tax base on the subsequent sale/transfer by a tax-exempt person to a non-exempt person, this Office adopts the depreciation rates prescribed under Customs Memorandum Order No. 10-89 dated January 19, 1989, viz: cdll Depreciation Table for Motor Vehicles Current Year Model No depreciation One-Year Old 10% Two-Year Old 20% Three-Year Old 30% Four-Year Old 40% Five-Year Old and Older models 50% Very truly yours, VICTOR A. DEOFERIO, JR. Acting Commissioner of Internal Revenue