Taipei Economic and Cultural Office in the Philippines

October 17, 2019 ITAD BIR RULING NO. 034-19 Principle of Reciprocity Taipei Economic and Cultural Office in the Philippines 41st Floor Tower 1, RCBC Plaza 6819 Ayala Avenue Gentlemen : This refers to your letter dated 14 May 2019, forwarded by the Manila Economic and Cultural Office (MECO) and the Office of Protocol of the Department of Foreign Affairs (DFA) requesting for the issuance of VAT Certificates (VC) in favor of AAA and BBB, dependent children of CCC, _______________ of Taipei Economic and Cultural Office (TECO) in the Philippines. aCIHcD In reply, please be informed that VAT exemption privileges are accorded to qualified resident foreign missions and their personnel in the Philippines based on the principle of reciprocity. Consequently, this Bureau issues VAT Certificates confirming grant of VAT exemption privileges to qualified resident foreign missions and their qualified personnel based on categorical confirmation by the DFA of the VAT exemption privileges being accorded to Philippine Foreign Service Posts and their personnel stationed in other countries. Moreover, the VAT exemption privileges accorded to qualified personnel of the resident foreign missions in the Philippines may extend to their dependent spouses and children if the same treatment is being accorded to dependents of Filipino diplomats abroad. Similarly, the grant of VAT exemption privileges to TECO and its personnel in the Philippines will depend on how MECO, the Philippine counterpart of TECO in Taipei, is being treated for VAT exemption purposes in Taipei. Based on the information received by the DFA from MECO, business tax exemption cards (the equivalent of VC in the Philippines) are only issued to MECO personnel and their dependent spouses in Taipei. However, dependent children do enjoy tax exemption privilege but through their principal. Hence, the DFA, in its letter dated 09 September 2019, recommends the issuance of a ruling to extend the same privileges to dependent children of TECO personnel in the Philippines. In view of all the foregoing, this Bureau is of the opinion and hereby rules the grant of VAT exemption privileges to dependent children of TECO personnel in the Philippines. Accordingly, they may enjoy VAT exemption at point-of-sale when accompanied by their parents who are principal holders of VAT Certificates duly issued by this Bureau. 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