BIR Ruling No. 285-2016

REPUBLICOFTHE PHILIPPINES

DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE

Quezon City

Section 109(T of the NIRC Revenue Regulations No.15-2015 BIR Ruling No.095-16

#285-2016

6272016

Old Admin PPA Building, Sta. Clara Pier. Batangas City 4200 STARLITE FERRIES,INC.

Attention : Mr.Francis S.Cusi

President

Gentlemen:

Ferries, Inc.. for a Certificate of Value-Added Tax (VAT) Exemption on its importation of a brand new RORO (roll-on, roll-off) Type Passenger Ferry Ship Number named.Starlite Saturn, pursuant to Section 109(1)(T) of the National Internal Revenue Code (NIRC) of 1997, as amended. This refers to your letter dated May 5, 2016, requesting on behalf of Starlite

Ferries, Inc. is currently importing a RORO (roll-on, roll-off) Type Passenger Ferry 003, series of 2006 dated March 11.2016 valid until April 3.2019: and that Starlite Ship (Builder's Ship No. engage in domestic shipping business per MARINA Memorandum Cireular No. 2006- Identification No. Securities and Exchange Commission (SEC under Company Registration No. Documents submitted show that Starlite Ferries, Inc.. with Taxpayer's that it is duly accredited by the Maritime Industry Authority (MARINA) to named Starlite Saturn from builder. Kegoya Dock Co. is a domestic corporation registered with the

Ltd. of Japan, which is particularly described as follows:

1 Dimensions Length (between perpendiculars) Depth (Promenade deck moulded/Car deck) Draft (designed draft/scantling draft) Length (overall) Breadth(moulded) approx. 9.40m/4.40m 3.20m/3.30m 66.80m 61.80m 15.30m

2 Gross Tonnage International) Abt. 2,600 M.T.

(3) Deadweight on designed draft abt. 630 M.T.

4 Carrying Capacity Passenger:727 persons Vehicle(Truck base): Truck dimension: 8.990m(L) x 2.490m(B) x 3.485m(H) Max truck capacity:19 Cars Truck weight : 25 tons

5Main Engine Maker YANMAR DIESEL CO.,LTD

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Starlite Ferrie,Inc./Starlite Saturn Page 2 of'3

Model YANMAR 6EY 22AW

N.C.O. M.C.O. 1,164 kW(1581ps -85% of M.C.O. 1.370 kW(1860ps)

Number of Engine 2 Sets

6Trial Maxim Speed 14.5 Knots

Starlite Ferries, Inc. dated April 28, 2016; that per Sworn Statement dated May 6, 2016 be manufactured domestically in comparable quality, technology and at a reasonable executed by Francis S.Cusi, President of Starlite Ferries,Inc.,the subject vessel cannot price,and that it is reasonably needed and will be used exclusively and will be used by the company operation. that MARINA has approved the importation of the above vessel in its letter addressed to

following documents: In support of its request for exemption, Starlite Ferries, Inc. has submitted the

I. Certified true copies of the SEC Certificate of Registration, Articles of 2 Certified true copy of Certificate of Registration with the BIR: Incorporation and By-Laws:

3 Certified true copy of MARINA Authority to Import dated April 28, 2016 4.Certificate of Registration/Accreditation with MARINA S Shipbuilding Contract for Construction and Sale of One (1) Ro-Ro Type

6. Sworn Statement dated May 6, 2016. Passenger ferry Ship No. : and

amended, provides as follows: In reply, please be informed that Section 109(1)(T) of the NIRC of 1997, as

"Sec.109 Exempt Transactions-Exempt Transactions.

(1) Subject to the provisions of Subsection (2) hereof. the following transactions shall be exempt from the value-added tax.

(T)' Sale, inportation or lease of passenger or cargo vessels and aircraft, including engine, equipment and spare parts thereof for domestic or international transport operations.

vessel destined for domestic transport operations shall be exempt from VAT. In relation Based on the above-cited provision, the importation, among others, of a cargo

thereto. Section 4.109-1 (B(1(t) of the Revenue Regulations (RR) No. 16-2005. as amended by RR No. 15-2015, which implements the above-quoted provision, provides:

"SECTION 4.109-1. VAT-Exempt Transactions.

XXxXXX XXX

(B) Exenpt transactions.

1 Renumbered by Republic Act No. 10378 042381

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Starlite Ferries, Inc./Starlite Saturn Page 3 of 3

1)Subject to the provisions of Subsection (2 hereof. the

following transactions shall be exempt from VAT:

XXXXXXXXX

t)Sale importation or lease of passenger or cargo

vessels and aircraft, including engine, equipment and spare

parts thereof for domestic or international transport

operations: Provided, however, that the exemption from VAT

on the importation and local purchase of passenger and/or

cargo vessels shall be subject to the requirements on

restriction on vessel importation and mandatory vessel

retirement program of MARINA."

In view of the foregoing, th importation by Starlite Ferries, Inc. of the

aforedescribed passenger vessel "Starlite Saturn" having been granted by MARINA with

the necessary clearances to be imported and is, thus, deemed compliant with the

requirements on restriction on vessel importation and mandatory vessel retirement

program of MARINA, shall be exempt from VAT pursuant to Section 109(1)(T) of the

NIRC of 1997, as amended. The VAT exemption, however, shall be subject to the strict

compliance of the conditions contained in the letter of approval issued by MARINA for

the importation of the subject passenger vessel. (BIR Ruling No. 095-16 dated March 16.

2016

This ruling is being issued on the basis of the foregoing facts as represented

However, if upon investigation, it will be disclosed that the facts are different, then this

ruling shall be considered null and void.

Very truly yours.

KIM S.JACINTO-HENARES Commissioner of Internal Revenue 042381

K-I-JAC JUN 2 4 2016