Request for Exemption from Advance Sales Tax on Shipment of Article Which Is a Replacement of a Tax-Paid Defective Article

September 17, 1986 BIR RULING NO. 181-86 162 (c) 110-86 181-86 Gentlemen : This refers to your letter dated July 15, 1986, requesting for and in behalf of your client Burroughs Limited, exemption from the payment of the advance sales tax on the shipment of an article which is allegedly a replacement of a tax-paid defective article. cdt It is represented that an importation was made by Burroughs Limited the original shipment of which arrived last January 19, 1986 under L/C No. 018733 for AWB No. 1065170 and released from customs custody by paying in full the duties and taxes as evidenced by receipts numbered, invoice No. 2200201; CBOR (IED) No. 662097 and RC No. 704-066; that of the items imported last January 19, 1986, one item namely: one (1) unit AP 1356 MTRX PTR RS 232/CENTR amounting to $1,425.00 was found to be defective; that said defective item was shipped back as per agreement with the suppliers as evidenced by export papers AWB No. IAC No. 00445; Export Invoice No. 0286732-1; Export Declaration Invoice No. ND-26488; Surety Bond No. SICI Bond No. 14640; that the second shipment of Burroughs Ltd., arrived last April 15, 1986 via AWB No. 06447158 per registration No. 2739 which contains the replacement of the defective item imported last January 19, 1986. In reply, please be informed that the advance sales tax imposed under Section 162(c) of the Tax Code as amended is levied and paid only once on the articles imported. Consequently, your client's second shipment of an article that would replace the defective item imported last January 19, 1986 the advance sales tax on which amounting to P7,492.00 has already been paid is no longer subject to another advance sales tax. This will serve as an authority for the Bureau of Customs to release the goods and to forego the imposition of the advance sales tax thereon. Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner