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March 12, 2018DA ITAD BIR RULING NO. 010-18Principle of Reciprocity;BIR Ruling No. ITAD-312-12Royal Embassy of Saudi Arabia128 H.V. Dela Costa cor. Sanchez StreetsSalcedo Village, Makati CityGentlemen :This has reference to your Note No. 10/1669 dated February 5, 2018 referred to this Office by the Department of Finance and the Department of Foreign Affairs, requesting for the exemption from the payment of value-added tax (VAT) and ad valorem taxes on the local purchase of a motor vehicle for the official use of the Royal Embassy of Saudi Arabia, specifically described as follows: HTcADC Type of Use:OfficialMake:Toyota Innova 2.0 E Gas ATModel Year:2018Color:ThermalyteFrame Number:PA2JW8EM3J3152459Engine Number:1TRA411330 In reply, please be informed that Article 34 of the Vienna Convention on Diplomatic Relations reads:"ARTICLE 34A 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"Thus, the tax exemption privilege of an Embassy and its diplomatic agents does not include exemption from VAT on...