ITAD Ruling No. 041-03

February 28, 2003 ITAD RULING NO. 041-03 Article IV (b) (1) of the Memorandum of Agreement between the Government of the Republic of the Philippines and the World Organization of the Scout Movement BIR Ruling No. 115-00 The World Organization of the Scout Movement Asia-Pacific Regional Office P.O. Box 4050 MCPO 1280 Makati City Attention: Mr. Abdullah Rasheed Regional Director (formerly Regional Executive Commissioner) Asia Pacific Regional Office Gentlemen : This has reference to your letter dated October 8, 2002 referred to this Office by the Department of Foreign Affairs (DFA), requesting for tax-free local purchase of one (1) motor vehicle, a Model. 2002 REVO VX200 5 A/T, for the personal use of Mr. Abdullah Rasheed, Regional Director of The World Organization of the Scout Movement, specifically described as follows: Type of use: Personal use Organization: World Organization of the Scout Movement c/o Salcedo St. Legaspi Village, Makati City Make: 2.0 REVO VX200 AT L Model year: 2002 Color: 3RF Burgundy Engine No: IRZ 2902409 Frame No: RZF81 4006612 In reply, please be informed that Article IV, paragraph 2(b)(i) of the Memorandum of Agreement between the Government of the Republic of the Philippines and the World Organization of the Scout Movement provides as follows: " Article IV " OFFICIALS AND EMPLOYEES "xxx xxx xxx "2. The Regional Executive Commissioner and the Deputy Regional Executive Commissioner shall enjoy the following tax and duty-free privileges: "xxx xxx xxx "(a) Exemption from customs duties and taxes on personal and household effects imported into the Philippines within six months from the date of first arrival; and (b) Tax and duty-free importation of one motor vehicle provided that: (i) such imported motor vehicle has been used in the country of last posting or such motor vehicle is purchased locally or from a third country within the period of six (6) months from the date of his or her first arrival in the Philippines; and (emphasis provided) "xxx xxx xxx It is clear in the abovementioned provisions that the Regional Executive Commissioner (now renamed Regional Director as provided by the letter of the Deputy Secretary General Luc Panissod of the World Organization of the Scout Movement dated October 9, 2002) and the Deputy Regional Executive Commissioner are exempt from taxes particularly for the purchase of one motor vehicle provided, however, that such motor vehicle is purchased locally or from a third country within the period of six (6) months from the date of his or her arrival in the Philippines. Accordingly, your request for exemption from VAT imposed under Section 106(A) of the Tax Code of 1997 on the local purchase of one (1) unit of Toyota Revo VX200 5 AT L, Model 2002 for the personal use of Mr. Abdullah Rasheed, Regional Director of The World Organization of the Scout Movement, is hereby granted. (BIR Ruling No. ITAD-115-00 dated August 29, 2000) It must be noted however, that this ruling supersedes BIR Ruling No. DA-ITAD-188-02 dated October 23, 2002. Very truly yours, (SGD.) MILAGROS V. REGALADO Assistant Commissioner Legal Service