Excise Tax Exemption on the Purchases and Withdrawal of Petroleum, Oil and Lubricants

August 31, 1988 BIR RULING NO. 420-88 145 (a) & (b) 174-87 420-88 Gentlemen : This refers to your letter dated June 20, 1988 requesting a ruling exempting from the excise taxes your purchases and withdrawal direct from oil refineries and/or bonded warehouses of petroleum, oil and lubricants to be used for the construction of Parallel Runway at Clark Air Base. cdt It appears that on November 19, 1987, Contract N62864-85-C-0099 for the construction of said Parallel Runway had been awarded to George A. Fuller & Co. and you, as a joint venture; and that on November 19, 1987, after complying with the requirements of performance guarantee and insurance, you were then directed to proceed with the work on the contract. In connection therewith, please be informed that Article V of the RP-US Military Bases Agreement provides as follows: "No import, excise, consumption or other tax, duty or impost shall be charged on material, equipment, supplies or goods, including food stores, clothing for exclusive use in the construction, maintenance, operation or defense of the bases, consigned to, or destined for, the United States authorities and certified by them to be for such purposes." Accordingly, your local purchases of the above materials are exempt from the excise taxes imposed under Section 145(a) and (b) of the Tax Code, as amended by Executive Order No. 273. However, the withdrawal from bonded stocks and delivery to the tax-exempt agency should comply with the following requirements: 1. The withdrawal of said articles from bonded stock be entered in the Official Register Books of the supplier and duly evidenced by a Withdrawal Certificate (BIR Form 2.67); 2. That Clark Air Base should provide George A. Fuller & Co. and you with Certificate of exemption (B.I.R. Rulings dated May 22, 1975 and August 27, 1985). cdta Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner