Embassy of the Republic of Turkey

June 20, 2019 ITAD BIR RULING NO. 015-19 Principle of Reciprocity; Revenue Memorandum Order No. 10-2019 Embassy of the Republic of Turkey 2268 Paraiso Street, Dasmarias Village 1222 Makati City Gentlemen : This refers to your letter dated 08 May 2019, indorsed by the Department of Foreign Affairs, Office of Protocol (DFA-OP), requesting for a BIR ruling on the value-added tax (VAT) exemption on the local purchase of goods and services for the Embassy of the Republic of Turkey and its personnel. In reply, please be informed that while the Vienna Convention on Diplomatic Relations of 1961 exempts diplomatic missions ( i.e. , embassies and consulates) and their diplomatic agents from all dues and taxes, personal or real, national, regional or municipal, they are nevertheless subject to the indirect taxes of a kind which are normally incorporated in the price of goods or services ( e.g. , VAT). Nevertheless, under the principle of reciprocity, this Office may grant tax privileges to a foreign embassy and to its members on their local purchases of goods and services, provided that they can submit to the Commissioner of Internal Revenue proof that the foreign government of the concerned embassy allows similar tax privileges to the Philippine Embassy or its personnel on purchases of goods or services in their country. As per the Indorsement of the DFA-OP dated 20 May 2019, and the DFA Matrix of VAT Privileges Enjoyed by the Philippine Foreign Service Posts dated 05 April 2019, the Philippine Embassy and the head of mission in Ankara, Turkey enjoy VAT exemption privileges at point-of-sale , while its diplomatic and non-diplomatic personnel enjoy VAT exemption privileges through reimbursement/refund , subject to the following limitations: 1. alcohol and tobacco products are NOT EXEMPT ; and 2. the minimum amount of purchase per invoice/receipt is Php750.00 . Based on the foregoing, this Office is of the opinion as it hereby rules that, applying the principle of reciprocity, the Embassy of the Republic of Turkey and the Head of its Mission ( i.e. , Ambassador) in the Philippines are entitled to VAT exemption at point-of-sale ; while the embassy's diplomatic and non-diplomatic personnel are entitled to VAT exemption privileges through reimbursement/refund basis. Accordingly, the Embassy of the Republic of Turkey and its Head of Mission shall continue to be issued with VAT Certificate. However, its diplomatic and non-diplomatic personnel shall proceed to secure the necessary VAT reimbursement/refund on purchases of local goods and services in the Philippines subject only to the aforementioned limitations, and following the guidelines set forth in Revenue Memorandum Order (RMO) No. 10-2019. Very truly yours, (SGD.) CAESAR R. DULAY Commissioner of Internal Revenue