Vat Exemption on the Shipment of Food Products from Canadian Food for Children

August 12, 1988 BIR RULING NO. 386-88 103 (u) 094-88 386-88 Gentlemen : This refers to your letter dated August 10, 1988 requesting that the shipment of food products coming from the Canadian Food for Children to be donated to the Daughters of Mary Help of Christians be exempt from the 10% value-added tax. According to you, the Canadian Food for children is a Non-Governmental Organization with which the Canadian International Development Agency (CIDA) has had many affiliations; that its Philippine partner is the Daughters of Mary Help of Christians who are involved in immediate relief services for poor Filipinos; and that the said food products will be used by the latter in the delivery of such relief services. In reply, please be informed that pursuant to Section 103(u) of the Tax Code as amended by Executive Order No. 273 and implemented by Section 9(b)(16) of Revenue Regulations No. 5-87, transactions which are exempt under International agreements to which the Philippines is a signatory, are exempt from the value-added tax. The General Agreements on Development Cooperation between the Governments of Canada and the Philippines partakes the nature of an international agreement. Such being the case, the aforesaid food products which are intended as donation from the Canadian Food for Children and consigned to the Daughters of Mary Help of Christians for its relief services to poor Filipinos are exempt from the 10% value-added tax. This serves as a certification authorizing the Daughters of Mary Help of Christians to secure the release from customs custody the shipment of 1 x 20 container van containing 909 bags of food stuffs covered by Bill of Lading No. 784743396 on board S1 Freedom Voy 08710 without payment of the 10% value-added tax. aisadc Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner