Question & AnswerQ&A (BIR REVENUE MEMORANDUM ORDER NO. 81-99)
The main purpose of BIR Revenue Memorandum Order No. 81-99 is to provide guidelines for the processing and issuance of a VAT Exemption Certificate to all qualified embassies and their personnel on their purchases of goods and services in the Philippines.
Embassies must file their VAT exemption requests first with the Office of Protocol of the Department of Foreign Affairs (DFA).
The International Tax Affairs Division (ITAD) processes the VAT exemption requests for embassies.
The request shall be filed preferably on the first quarter of the calendar year.
If there is no previous ruling exempting an embassy, the request for certification is treated as a request for a ruling.
The ruling is valid and effective for as long as the embassy concerned is included in the updated list of diplomatic missions entitled to VAT exemptions on the basis of reciprocity as prepared by the DFA Office of Protocol.
The embassy remains exempt from VAT for the current year but will not be entitled to VAT exemption in the following year unless it appears again in the DFA’s list based on reciprocity.