ITAD Ruling No. 012-99
ITAD Ruling No. 012-99 • Bureau of Internal Revenue (BIR) Issuances • International Tax Affairs Division (ITAD) Rulings • Jul 26, 1999
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July 26, 1999 ITAD RULING NO. 012-99 Sec. 106 Sec. 108 206-93 Embassy of the Republic of Italy Metro Manila, Philippines Attention: Mr . Andreas Ferrarese Charge d' Affaires a . i . Gentlemen : This refers to your letter dated June 15, 1999, requesting for exemption from value-added tax (VAT) on the purchase of one (1) unit white TOYOTA HILUX DIESEL 4X4, 1999 Model with Engine No. 3L-4758705 and Chassis No. LN166-0027823 for the official use of the Italian Cooperation for Development Unit, Embassy of the Republic of Italy, for the project "Assistance to the National Tuberculosis Control Programme." LexLib In reply, please be informed that pursuant to Article 34 of the Vienna Convention on Diplomatic Relations, pertinent portion of which reads: "Article 34 "A diplomatic agent shall be exempt from all dues and taxes, personal or real, national, regional or municipal, except: "(a) indirect taxes of a kind which are normally incorporated in the price of the goods and services; xxx xxx xxx the tax exemption privilege of an Embassy and its diplomatic agents does not include exemption from value-added tax (VAT) on its local purchases of goods and services. In other words, purchases by that Embassy of goods and/or services shall be subject to the value-added tax prescribed under Sections 106 and 108, both of the National Internal Revenue Code of 1997. However, under the principle of reciprocity, this Office may grant exemptions to the Embassy of the Republic of Italy or its personnel on their local purchases of goods and/or services it appearing from the list submitted by the Department of Foreign Affairs that your Government allows similar exemption to Philippine Embassy personnel on their purchase of goods and services in your country. Hence, the local purchase of one (1) white TOYOTA HILUX DIESEL 4X4, for the official use of the Italian Cooperation for Development Unit, Embassy of the Republic of Italy is exempt from VAT. LibLex Very truly yours, (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner Legal and Enforcement Group
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