VAT Ruling No. 058-01

September 12, 2001 VAT RULING NO. 058-01 Sec. 109 (c) VAT Ruling No. 068-90 Land Bank of the Philippines 319 Sen. Gil Puyat Ave. Ext., Makati City Attention: Mr . Mauricio C . Feliciano Asst. Vice-President Gentlemen : This refers to your letter, dated August 9, 2001, requesting for exemption from the value-added tax of your importation of "Bovine Semen" relative to the Cattle Production Through Artificial Insemination (AI) Project (herein referred to as the "Project"). It is represented that on March 21, 1997 your Bank, through the National Economic and Development Authority (NEDA), has been granted a FF2.85 million technical and financial assistance by the French Government for the implementation of the Project, which aims to increase cattle production and improve the genetic quality of our local cattle through AI using French Breeds (Limousine, Charolais and Blonde D'Aquitaine). We understand that the Project benefited "Landbank-assisted cooperatives/farmers" in Davao and Dumaguete City. Moreover, due to its successful implementation, the Project was extended until 30 April 2003. Hence, you now request for exemption from value-added tax of your additional importation of 2,000 doses of frozen Bovine Semen solely intended for the use of farmers and not for commercial purposes and which importation has been granted an Import Permit dated 12 July 2001 by the Bureau of Animal Industry (BAI). In reply, please be informed that pursuant to Section 109 (c) of the National Internal Revenue Code of 1997, sale or importation of agricultural and marine food products in their original state, livestock and poultry of a kind generally used as, or yielding or producing foods for human consumption; and breeding stock and genetic materials therefor, are exempt from value added tax. Since Bovine Semen qualifies as breeding and genetic materials that are intended for the raising of livestock (which includes cows, bulls, calves, pigs, goats and rabbits), the importation thereof is exempt from value-added tax [Section 4.103-l(B)(c) of Revenue Regulations No. 7-95, VAT Ruling 068-90 dated March 9, 1990)]. Accordingly, this ruling serves as the authority of the Bureau of Customs to release the above importation, which shall be in lieu of the issuance of the Application to Release Imported Goods (ATRIG). Moreover, this ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. ADEacC Very truly yours, Commissioner of Internal Revenue By: (SGD.) EDMUNDO P. GUEVARA Deputy Commissioner Legal and Inspection Group