Legal basis and related references
- The memorandum directs observance of rules grounded on Section 131 of Republic Act No. 8424 (Comprehensive Tax Reform Program).
- The memorandum is also stated to be consistent with the Bureau of Customs’ earlier memos on the payment of excise tax.
- The memorandum references Presidential Decree No. 1590 as the legislative franchise basis invoked for PAL’s tax-exempt status claims.
Policy and purpose
- The memorandum establishes specific customs collection treatment for PAL aviation fuel importations while issues on tax-exempt status are being resolved.
- The memorandum separates excise-tax treatment based on the operational use of the aviation fuel (international versus domestic operations).
Scope: PAL aviation fuel importations
- The memorandum governs importations of Aviation Turbo Fuel or Jet A-1 Fuel by PAL.
- The memorandum classifies use of the imported fuel by operation type.
- For international operations, the memorandum provides an excise tax exempted treatment.
- For domestic operations, the memorandum provides that the fuel importation is subject to payment of excise tax.
Excise tax rule for PAL aviation fuel
- The memorandum requires excise tax to be collected upfront on PAL aviation fuel importation used for domestic operations.
- The memorandum directs that excise tax be collected prior to the release of the importation from the port of discharge.
- The memorandum reiterates that this excise tax collection is required on the importation of aviation fuel by PAL under the described operational-use classification.
Compliance directive
- The memorandum orders strict compliance with the excise tax collection timing rule.
- The memorandum reiterates application of the collection requirement for PAL aviation fuel importations for domestic operations and corresponding treatment for international operations (excise tax exempted).