FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES —)
FIRST REGULAR SESSION

HOUSE OF REPRESENTATIVES

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

3487

House Bill No.

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 earnestly requested that this bill be enacted into law.

RUFYS B. RO! UEZ

MAXIMO B. RODRIGUEZ, JR.


FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES —)
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and
Representative Maximo 8. Rodriguez, Jr.

House Bill No__ 3487

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