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July 17, 2019DA ITAD BIR RULING NO. 026-19Principle of Reciprocity;BIR Ruling No. ITAD-347-12The British Embassy120 Upper Mckinley Road Mckinley Hill1634 Taguig CityGentlemen :This has reference to your Notes No. 19-133 and 19-134 dated June 25, 2019, respectively, referred to this Office by the Department of Finance and the Department of Foreign Affairs (DFA), requesting for the exemption from the payment of value-added (VAT) and ad valorem taxes on the local purchase of two (2) units of motor vehicle for the official use of the British Embassy, specifically described as follows:  MakeYearColorFrame NumberEngine NumberFord Everest 3.2L 4x4 A/T Titanium Plus2018Meteor GreyMNCAXXMAWAJT24111P5AT2627907Ford Everest 3.2L 4x4 A/T Titanium Plus2018Aluminum MetallicMNCAXXMAWAJJ34465P5AT2643867  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...