Non-taxability of the First Transfer of the Car from a Tax-exempt Person to a Non-tax-exempt Person

August 4, 1958 BIR RULING NO. 396-58 The Officer-in-Charge Reg. and Lic. Division Motor Vehicles Office East Avenue, Quezon City S i r : Reference is made to your letter dated August 1, 1958 inquiring whether or not Mr. Cesar B. Serapio, presently the possessor of an automobile originally acquired from a tax-exempt person, is liable to the compensating tax on said automobile. It appears that the automobile in question was originally brought tax-free into this country by Sgt. Charles A. Carillon of the U.S. Army on September 15, 1955 and registered in his name in same year. The car was transferred for the first time to Mr. Domingo D. Lim, a non-tax-exempt person, on March 10, 1956 who was able to register the same in his name. Mr. Serapio is the fourth transferee of the car who acquired it from Mr. Libertad Chaplin, the third transferee thereof, on July 30, 1958. In reply, I have the honor to inform you that the first transfer of the car from a tax-exempt person to a non-tax-exempt person on March 10, 1956 is not subject to tax, pursuant to the decision of the Supreme Court in the case entitled "Marcelino Viduya vs. Collector of Internal Revenue", G.R. No. L-10808. Accordingly, the car in question may be registered in the name of Mr. Cesar B. Serapio without the necessity of requiring him to present proof of payment of the compensating tax. LLphil Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue