Tax Exemption Privileges to the AFP Retirement and Separation Benefits System

December 15, 1989 BIR RULING NO. 260-89 21 (c) (1) 53 (b) 000-00 260-89 Gentlemen : This refers to your letter dated September 18, 1989 requesting reaffirmation of BIR Ruling dated February 21, 1978 granting tax exemption privileges to the AFP Retirement and Separation Benefits System (AFPRSBS) pursuant to Presidential Decree No. 361 issued on December 30, 1973 as amended by PD 1656. Likewise, you request a ruling that the Certificate of Time Deposits and Money Market Placements as well as Treasury Bill purchases of the AFPRSBS be exempt from any withholding tax. It is represented that the AFPRSBS is a pension fund of the Armed Forces of the Philippines primarily aimed at giving pension benefits to AFP members and their beneficiaries. cdta In reply, please be informed that both of the above requests cannot be granted for lack of legal basis. It may be stated that Presidential Decree Nos. 1931 and 1955 issued on June 11, 1984, and October 14, 1984, respectively, withdrew the tax and duty exemption privileges, including the preferential tax treatment, of government-owned or controlled corporations and all other units of government and private entities. Corollary to this, Executive Order No. 93 effective March 10, 1987 withdrew all tax and duty incentives granted to government and private entities subject to certain exemptions. cd Very truly yours, (SGD.) JOSE U. ONG Commissioner