Tax Imposed on Vessels M/V "Maria Rosello" and M/S "General Lim"

October 28, 1960 BIR RULING NO. 466-60 Mr. Leocadio De Asis Attorney-At-Law P. O. Box 292, Manila S i r : This is in connection with your letter dated October 27, 1960, requesting a ruling as to whether or not the vessels M/V "Maria Rosello" and M/S "General Lim" obtained by the Bothelho Shipping Corporation and the General Shipping Co., Inc. from abroad through the Reparations Commission are subject to the compensating tax. Section 14 of Republic Act 1789 otherwise known as the Reparation Law provides as follows: "Sec. 14. Exemption from Tax . All reparations goods obtained by the government shall be exempt from the payment of all duties, fees and taxes. Reparations goods obtained by private parties shall be exempt only from the payment of customs duties, consular fees and the special import tax ." (Emphasis ours) In accordance with the abovequoted provision of the Reparation Law, this Office has consistently ruled that reparation goods obtained by private entities for their use are subject to the compensating tax prescribed in section 190 of the National Internal Revenue Code. Accordingly, the abovementioned vessels obtained from the Reparations Commission by Bothelho Shipping Corp. & General Shipping Co. Inc. which are both private entities, are subject to the compensating tax, said tax to be computed on the purchase price thereof plus freight, postage, insurance and all similar charges. Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue