Air France No Longer Subject to the 15% Branch Profit Remittance Tax

November 29, 1985 BIR RULING NO. 211-85 24-b 00-85 211-85 S i r : This refers to your letter dated October 3, 1985 requesting for confirmation that Air France would no longer be subjected to the 15% Branch Profit Remittance Tax. In reply, please be informed that the RP-France Tax Treaty covers income taxes. Thus, Article 8 thereof providing for the maximum tax of 1 % of the gross revenue that the Philippines may impose on profit "from the operation of ships or aircraft in international traffic" refers only to its income taxes. It is for this reason that once the 1.5% maximum tax is collected, the 15% branch profit remittance tax, which is also an income tax, can no longer be collected. WHEREFORE, Air France, by reason of the tax treaty, is no longer subject to the 15% branch profit remittance tax imposed under Section 24(b)(2)(ii) of the National Internal Revenue Code. cdtech Very truly yours, (SGD.) RUBEN B. ANCHETA Acting Commissioner