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July 5, 2018DA ITAD BIR RULING NO. 026-18Principle of Reciprocity;BIR Ruling No. ITAD-294-11Embassy of the Republic of Indonesia185 Salcedo St. Legaspi VillageMakati CityGentlemen :This has reference to your Note No. PK/0801/VI/2018 dated June 8, 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 (VAT) and ad valorem taxes on the local purchase of a motor vehicle for personal use of AAA, _______________ of the Embassy the Republic of Indonesia, specifically described as follows: TIADCc Type of Use:PersonalMake:Toyota HiAce Super Grandia Fabric 3.0 DSL ATModel Year:2018Color:Extreme BlackFrame Number:JTFRT13P5J8026035Engine Number:1KD2803065 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...