0% VAT on Service Invoice

May 5, 1988 BIR RULING NO. 191-88 102(a) (2) 000-00 191-88 Gentlemen : This refers to your letter dated March 17, 1988 stating that your client, Ipil International, Inc., is a corporation duly organized and existing under Philippine laws acting as agent and/or husbanding agent of MV "Meng Hai" whose owner/principal is based in Hamburg, Germany; that for stevedoring services, wherever the vessel is in the Port of Manila, your client appoints Ocean Terminal Services, Inc. for the loading of cargoes on board the vessel MV "Meng Hai", for which service, a service invoice is presented which includes payment of the corresponding VAT; that as payment for services rendered and for other incidental expenses incurred by your client, the foreign principal remits the necessary funds in foreign currency through one of the local banks, you are of the opinion that your client is subject to the value-added tax at 0%. In reply, please be informed that on the basis of the foregoing representation your opinion is confirmed. The services of your client which are paid for in acceptable foreign currency inwardly remitted to the Philippines and accounted for in accordance with the rules and regulations of the Central Bank of the Philippines are subject to the value-added tax at 0% pursuant to Section 102(a)(2) of the Tax Code as amended by Executive Order No. 273 and amplified by Revenue Regulations No. 5-87. Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner