Embassy of India

June 8, 2021 ITAD BIR RULING NO. 030-21 Principle of Reciprocity; RMO No. 10-2019, as amended by RMO No. 41-2020 Embassy of India 2190 Paraiso Street Dasmarias Village P.O. Box 2123, MCPO 1221 Makati City Gentlemen : This refers to the indorsement by the Department of Foreign Affairs, Office of Protocol (DFA-OP) dated 06 May 2021 in connection with the value-added tax (VAT) exemption on local purchase of goods and services of the Embassy and its diplomatic personnel. aScITE 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, however, subject to indirect taxes of a kind which are normally incorporated in the price of goods or services ( e.g. , VAT). Nevertheless, on the basis 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 a 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 06 May 2021 and the DFA Matrix on VAT Privileges Enjoyed by the Philippine Foreign Service Posts dated 02 March 2021, the Government of the Republic of India accords VAT exemption privileges on local purchase of goods ( including fuel and petroleum ) and services to the Philippine Embassy and its diplomatic personnel in New Delhi, India by way of reimbursement/refund , subject to the following: 1. The ONLY UTILITIES allowed for reimbursement/refund are cable, internet and telephone charges; and 2. There is NO MINIMUM AMOUNT required to avail of VAT exemption privileges. Based on the foregoing and applying the principle of reciprocity which was reiterated in Revenue Memorandum Order (RMO) No. 10-2019, as amended by RMO No. 41-2020, this Office is of the opinion as it hereby rules that the Embassy of the Republic of India and its qualified diplomatic personnel in the Philippines are entitled to the same VAT exemption privileges through reimbursement/refund , and not through point-of-sale basis. Accordingly, the Embassy and its diplomatic personnel may proceed to secure the necessary VAT reimbursement/refund on purchases of local goods and services in the Philippines subject to the aforementioned limitation and following the guidelines set forth in RMO No. 10-2019, as amended by RMO No. 41-2020. This ruling CANCELS and SUPERSEDES BIR Ruling No. ITAD-006-20 issued on 07 January 2020. Very truly yours, (SGD.) CAESAR R. DULAY Commissioner of Internal Revenue