VAT Ruling No. 091-91

December 5, 1991 VAT RULING NO. 091-91 103 (u) 000-00 091-91 Fernando L. Loteria Customs Broker Room 312, FEM II Building Andres Soriano, Jr. Ave., Intramuros, Manila S i r : This refers to your letter dated August 29, 1991 requesting clarification on the propriety of payment of the 10% VAT on the importation of capital equipment of Marcopper Mining Corporation based on the 5% import levy imposed under E. O. 443, as amended by E.O. 475. It is represented that your client, Marcopper Mining Corporation, a BOI-registered firm, is authorized to import capital equipment exempt from customs duties and taxes pursuant to Article 39(c) of E.O. No. 226, otherwise known as the Omnibus Investment Code but some customs appraisers impose the 10% VAT on the imported capital equipment based on the computed 5% import levy. In reply, please be informed that generally importation of goods is subject to 10% VAT under Section 101(a), NIRC, as amended. However, Section 103(u) of the same Code, exempts from the payment of VAT transactions which under special laws are exempt from tax. Since your client's importation of capital equipment is exempt under E.O. No. 226, a special law, such importation is not subject to VAT. In other words, no VAT should be imposed on the 5% import levy collected on tax-and-duty-free importations. Please be guided accordingly, Very truly yours, VICTOR A. DEOFERIO, JR. Deputy Commissioner (Officer-In-Charge)