Exemption of the Local Purchases of Materials from the Sales Tax

August 31, 1988 BIR RULING NO. 424-88 163 248-87 424-88 Gentlemen : This refers to your local purchases of construction materials needed/required for the New Headquarters Building Project of the Asian Development Bank (ADB as certified to by the Special Project Officer of said Bank under Certificate of Project Goods No. 3 dated November 5, 1987 and transmitted to this Office by the Acting Chairman, Philippine Coordinating Committee on the Asian Development Bank, in his letter dated November 6, 1987. It appears that under the Supplementary Agreement to the agreement between the Asian Development Bank and the Government of the Philippines regarding the Headquarters of the Asian Development Banks ratified by the President of the Philippines on February 25, 1985 and the Memorandum of Understanding between the Government of the Philippines and the Asian Development Bank as ratified by the President of the Philippines on July 24, 1985 and as implemented by Ministry Order No. 1-86 of the Ministry of Finance, all local purchases made by the Bank or its contractor or sub-contractor, of supplies to be used in the Project are exempt from sales tax provided, that the Special Project Officer of the Bank issues a certificate concerning the use of such specific item purchased, the same to be furnished to the Ministry of Finance through PCC/ADB. In connection therewith, please be informed that your above local purchases of materials which occurred prior to the effectivity of the VAT law on January 1, 1988 are exempt from the sales tax. cdti Very truly yours, (SGD.) BIENVENIDO A. TAN, JR. Commissioner