Exemption from the Payment of the 10% Overseas Communications Tax

December 11, 1989 BIR RULING NO. 246-89 118 (a) 000-00 246-89 Gentlemen : This refers to your letter dated August 11, 1989 requesting a ruling as to whether Plan International Baguio Philippines, one of your customers, is exempt from the ten (10%) overseas communications (OVCOM) tax imposed by Section 118(a) of the Tax Code, as amended, on the ground that it is exempt from paying any tax under Act No. 4169. aisadc In reply, please be informed that assuming that Republic Act No. 4169 can serve as basis for exemption from payment of the 10% overseas communications tax, it appears that the said organization is not one of those granted tax exemption under said law. Moreover, Section 118(a) of the Tax Code explicitly limits the exemption from the payment of the 10% overseas communications tax to only four (4) entities, namely: (i) Government; (ii) Diplomatic Services; (iii) International Organizations; and (iv) News Services. Since it has not been sufficiently shown that Plan International Baguio Philippines is one of those enumerated under said Section 118(b) of the Tax Code, it is not exempt from the 10% overseas communications tax. Very truly yours, (SGD.) JOSE U. ONG Commissioner