Embassy of the Socialist Republic of Vietnam

October 26, 2020 ITAD BIR RULING NO. 067-20 Principle of Reciprocity; Revenue Memorandum Order No. 10-2019 Embassy of the Socialist Republic of Vietnam 670 Ocampo St., Malate 1004 Manila Gentlemen : This refers to your Note No. 104/VN-CH/2020 dated 30 September 2020, indorsed by the Department of Foreign Affairs, Office of Protocol (DFA-OP), requesting for a BIR ruling on the value-added tax (VAT) exemption privilege of the Embassy of the Socialist Republic of Vietnam and its qualified personnel by way of reimbursement/refund. 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 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 a proof that the foreign government allows similar tax privileges to the Philippine Embassy or its personnel on their respective purchases of goods or services in the concerned country. As per the Indorsement of the DFA-OP dated 01 October 2020, and the DFA Matrix of VAT Privileges Enjoyed by the Philippines Foreign Service Posts dated 01 October 2020, the Philippine Embassy and its diplomatic personnel in Hanoi enjoy VAT exemption privileges by way of reimbursement/refund. There is no minimum amount requirement to avail of VAT exemption. Based on the foregoing, this Office is of the opinion as it hereby rules that, applying the principle of reciprocity, and pursuant to Revenue Memorandum Order (RMO) No. 10-2019, the Embassy of the Socialist Republic of Vietnam and its diplomatic personnel are entitled to the same VAT exemption privileges by way of reimbursement/refund . Accordingly, the Embassy of the Socialist Republic of Vietnam may proceed to secure the necessary VAT reimbursement/refund on local purchases of all goods and services in the Philippines following the guidelines set forth in RMO No. 10-2019. TIADCc Very truly yours, (SGD.) CAESAR R. DULAY Commissioner of Internal Revenue