Embassy of the State of Libya

February 20, 2020 ITAD BIR RULING NO. 020-20 Vienna Convention on Diplomatic Relations, Article 23 Embassy of the State of Libya 2056 Lumbang corner Caballero Streets Dasmarias Village 1222 Makati City Gentlemen : This refers to your Note Verbale No. 104/2019 dated 27 September 2019, endorsed by the Department of Foreign Affairs, Office of Protocol, requesting for a special ruling on the Embassy of the State of Libya's exemption from the payment of taxes associated with the purchase of four (4) condominium units situated at PET Plans Tower (formerly El Tower Condominium), EDSA, Guadalupe, Makati City, on the basis of reciprocity. HTcADC In reply, please be informed of Article 23 of the Vienna Convention on Diplomatic Relations adopted on 24 April 1964 ("Vienna Convention"), to wit: " Article 23 1. The sending State and the head of the mission shall be exempt from all national, regional or municipal dues and taxes in respect of the premises of the mission , whether owned or leased, other than such as represent payment for specific services rendered. 2. The exemption from taxation referred to in this article shall not apply to such dues and taxes payable under the law of the receiving State by persons contracting with the sending State or the head of the mission. " (Underscoring supplied) Applying the above provision, the sending State, like the State of Libya in the instant case, as represented by its diplomatic mission, the Embassy of the State of Libya in the Philippines, is exempt from national taxes in respect of the premises of the mission, i.e. , chancery. Accordingly, the Embassy of the State of Libya, being an exempt entity, cannot be made liable for the payment of national taxes associated with the embassy's purchase of real property in the Philippines, to be used as its chancery, such as value-added tax (VAT), documentary stamp tax and capital gains tax. In view of the foregoing, the Embassy of the State of Libya is exempt from VAT in its purchase of real property to be used as its chancery in the Philippines. Accordingly, the non-privileged party in the transaction, which is the vendor, shall be liable for the payment of documentary stamp tax and capital gains tax. CAIHTE This ruling is issued on the basis of the facts as represented. However, if upon investigation it shall be disclosed that the actual facts are different, then this ruling shall be without force and effect insofar as the herein parties are concerned. Very truly yours, (SGD.) CAESAR R. DULAY Commissioner of Internal Revenue