October 14, 2019
ITAD BIR RULING NO. 031-19
Principle of Reciprocity;
Revenue Memorandum Order No. 10-2019
Embassy of Spain
27th Floor, Equitable Bank Tower
8751 Paseo de Roxas
1226 Makati City
Gentlemen :
This refers to your request, indorsed by the Department of Foreign Affairs, Office of Protocol (DFA-OP), for Value-Added Tax Exemption on local purchase of goods and services in favor of your Embassy and diplomatic personnel. cHECAS
In reply, please be informed that while the Vienna Convention on Diplomatic Relations of 1961 exempts diplomatic missions (i.e., embassies and consulates) and their diplomatic agents from all dues and taxes, personal or real, national, regional or municipal, they are nevertheless subject to the indirect taxes of a kind which are normally incorporated in the price of goods or services (e.g., VAT).
Nevertheless, under the principle of reciprocity, this Office may grant tax privileges to a foreign embassy and to their members on their local purchases of goods and services, provided that they can submit to the Commissioner of Internal Revenue proof that the government of the concerned embassy allows similar tax privileges to the Philippine...
