SIXTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

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Introduced by Representative Rufus B. Rodriguez
Representative Maximo B. Rodriguez, Jr.

House Bill No. 4054

EXPLANATORY NOTE

This bill seeks to provide as exemption from the Imposition of value added tax (VAT)
on donated imported goods for medical and education assistance, humanitarian relief and
similar purposes.

The law, under Section 107 of the National Internal Revenue Code, prescribes that
every importation shall be subject to Value Added Tax.

It is thus proposed that donated items or goods from foreign donors which are for
non-profit, charitable, medical, educational, humanitarian, relief purposes for the benefit of
the poor and the needy should be exempt from payment of the Value Added tax.

If such are exempt from VAT, it will facilitate the entry and the distribution of
donations for the benefit of the less fortunate.

Itis eamestly requested that this bill be enacted into law.

A
MAXIMO B. apa, JR.


SIXTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and

House Bill No. _40 54

AN ACT
AMENDING SECTION 107 (A) OF THE NATIONAL INTERNAL REVENUE CODE
SEEKING TO EXEMPT FROM THE IMPOSITION OF VALUE ADDED TAX DONATED
IMPORTATION OF ITEMS OR GOODS, WHICH ARE FOR NON-PROFIT, CHARITABLE,
HUMANITAIAN, RELIEF PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assemble.

SEC. 1. Section 107 (A) of the National Internal Revenue Code is hereby amended to
read as follows:

Sec. 107, Value-Added Tax on Importation of Goods. ~

(A) In General, - There shall be levied, assessed and collected on every
importation of goods a value-added tax equivalent to ten percent (10%) based on the
total value used by, the Bureau of Customs in determining tariff and customs duties
plus customs duties, excise taxes, if any, other charges, such tax to be paid by the
importer prior to the release of such goods from customs custody: Provided, That
where the customs duties are determined on the basis of the quantity or volume of
the goods, the value-added tax shall be based on the landed cost plus excise taxes,
if any, PROVIDED THAT DONATED ITEMS OR GOODS FROM DONORS ABROAD
WHICH ARE FOR NON-PROFIT, CHARITABLE, MEDICAL, EDUCATIONAL,
HUMANITARIAN AND RELIEF PURPOSES SHALL BE EXEMPT FROM VALUE
ADDED TAX UNDER THIS PROVISION: PROVIDED FURTHER, THAT THOSE
SUBJECT OF EXEMPTION OF IMPORT DUTIES UNDER THE TARIFF AND
CUSTOMS CODE SHALL LIKEWISE BE EXEMPT FROM THE PAYMENT OF THE
VALUE ADDED TAX, PROVIDED FURTHER, THAT THOSE DONATIONS OR
FOOD, MEDICINE AND EQUIPMENT FOR USE IN THE GOVERNMENT REFIEL
AND REHABILITATION PROGRAMS FOR CALAMITY AFFECTED AREAS AS
MANDATED IN PRESIDENTIAL MEMORANDUM ORDER NO. 36 SERIES OF
1992, WHICH HAVE BEEN APPROVED FOR EXEMPTION FROM IMPORT
DUTIES, SHALL LIKEWISE BE EXEMPT FROM THE VALUE ADDED TAX.

SEC. 2. Within sixty-days from the enactment of this law, the Secretary of Finance shall
promulgate the implementing rules of this law

SEC. 3. Should any of the provisions above be held unconstitutional, then the remaining
provisions shall remain effective

SEC. 4. This Act shall take effect fifteen (15) days following its publication in at least two (2)
newspapers of general circulation.

Approved,