VAT Ruling No. 066-90

March 9, 1990 VAT RULING NO. 066-90 Amaya Shipping Inc. Room 501, Dona Felisa Syjuco Bldg. Remedios Street, Malate Metro Manila Attention: Mr . Margarito Buot General Manager S i r s : This has reference to your letter dated October 19, 1989 wherein you represented that your company is engaged in VAT-registered manning and crewing services for foreign vessels; that it was nominated by the charterer, Mercury International London, to act as its agent to supervise the loading of molasses in the Philippines; that for such services rendered, you bill your foreign contractee your agency fee together with the port expenses that you have advanced in its behalf; and that in payment of the bill, your foreign contractee remits the whole amount in foreign currency to its local agent, (Filsov Shipping Co.) which subsequently pays you in Philippine pesos. Based on the foregoing facts, you request for a ruling on the applicability of the value-added tax on the aforecited services. In reply, please be informed that the 10% VAT is applied to the extent of your agency fees provided that the individual receipts evidencing payment of port expenses shall be in the name of the local agent for the account of your foreign contractee. If the entire amount is billed through your own VAT invoice, then your agency fee together with the reimbursable expenses shall be subject to 10% VAT. LLphil Very truly yours, JOSE U. ONG Commissioner of Internal Revenue