BIR Ruling No. 281-2022

REPUPLIC OF THE PHILIPPINES

DELARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE

Quezon City

Section 109 (1) (T) of the Tax Code of 1997, as amended BIR Ruling No.VAT-137-21

JUN_022022 VAE-:

MAMSAR CONSTRUCTION AND INDUSTRIAL CORPORATION Macapagal Avenue, Tubod Iligan City, 9200

Attention: Almita D. Barug Vice President -- Projests

Gentlemen:

This refers to your request for an exemption froir. value-added tax (VAT) on the importation of one (1) unit 2008-built, 326 GT Tug Boat, "M/V Southernline 3 (to be named M/Y Manuel 3') from the registered owner, Pioneer Mariner SDN BHD of Malaysia.

Documents submitted disclose that MAMSAR Const:uction and Industrial Corporation ("MAMSAR"), with Taxpayer Idenstification Number (TIN) corporation organized under the laws of the Republic of trie Philippines; that it is registered , is a domestic

with the Securities and Exchango Commission (SEC) under Company Registration No.

businesses including the construction, enlarging, repairing, removing, developing, or otherwise that its primary purpose is "[t]o engage in general construction and other allied

engaging in any work upon buildings, roads, highways, manufacturing plants, bridges, airfields, piers, docks, mines, shafts, waterworks, railroads, railway structures, all iron steel. wood, masonry and earth construction, and to make, execute, bid for and take or receive any contracts or assignment of contracts therefore, or in relation thereto, or connected therewith and to manufacture and furnish build:ng materials and supplies connected therewith: and doing of any and all other business and coni.racting incidental thereto or connected therewith, and the doing and performing of any and all acts and things necessary, proper or convenient for and incidental to the furtherance and /or implementation of the purpose therein mentioned."; that it is duly accredited by the Maritime Industry Authority (MAFINA) and is authorized to engage in domestic shipping business per MARINA Certifioation No. dated

Mariner SDN BHD of Malaysia, pa. ticularly described as fe llows: January 28, 2022 which is valid until January 27, 2025; anc that it is currently importing one (1) unit vessel named "M/V Southernline 3" (to be name&. "M/V Manuel 3') from Pioneer

IMO Number Vessel Type Flag Port of registry Specification Vessel Name Vessel Tug Boat. Malaysia Kuching M/V Man'1el 3) "M/V Southernline 3" (to be named

VAT:

JUN 0 2 zJZ2Z

Length Registered Depth Registered Net Tonnage Breadth Registered Gross Tonnage Place of Building/Shipyari Classification Previous Owner Main Engine Gen Set Hull material Year Built 31.00 Meters 27.907 Meters 4.30 Meters 326 2 x Mitsubishi S6R2 MTK3L 759 2 x 80 KW Each 3/50/415 Nippon Kaiji Kyokai(NKK) 2008 Pioneer Matiner SDN BHD 98 KW/ 1406 RPM Sibu, Sarawak Malaysia Steel

Code (Tax Code) of 1997, as amended, provides as follows: In reply, please be informed that Section 109 (1) (T) of the National Internal revenue

"SEC. 109. Exempt Transactions.

transactions shall be exempt from the value-o dded tax. (1) Subject to the provisions of subsection (3?) hereof. the following

XXX XXX XXX

domestic or internaticnal transport operations; (T) Sale, importation or lease of passenger or cargo vessels and aircraft, including erigine, equipment and spare paris thereof for

16-2005, as amended, states that: In relation thereto, Section 4.109-1 (B) (1) (t) of Revenue Regulations (RR) No

"SECTION 4.109-1. VAT-Exempt Transaction

XXX XXX XXX

(B) Exempt Transaciions.

transactions shall be ?xempt from VAT: (1) Subject to the prcvisions of Subsection () hereof, the following

XXX XXX XXX

(t) Sale, importatio.% or lease of passenger or cargo vessels and vessel retirement program of aircraft, including engine, equipment and spare parts thereof for domestic or internattional transport operatio:ns; Provided, however. that the exemption from VAT on the importuiion and local purchase of passenger andior cargo vessels shuil be subject to the reguirements on restriction on vessel importation and mandatory MaritinieIndustryAuthority (MARINA):

VAT.-2 8 1 - 2 0 2 2

JUN 1 7 2222.

Based on the above-cited provisions, the importation of passenger or cargo vessel destined for domestic transport operations shall be exempt from VAT. Hence, the importation by MAMSAR of one (1) unit vessel named "M/V Southernline 3" (to be named 'M/V Manuel 3') shall be exempt from VAT pursuant to Section 109 (1) (T) of the Tax Code of 1997, as amended. However, the VAT exemption shall be subject to the requirements on restriction on Vessel importation and mandatory vessel retirement program of MARINA.:

This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disciosed that the facts are cifferent, then this ruling shall be considered null and void.

Very truly yours,

1s CAESAR R. DULAY Commissioner of Internal Revenue

051742 K-1

Subject to presentation of the Authority to Import issued by the MARiNA