Excise Tax on PAL Aviation Fuel Importation

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BOC MEMORANDUM: Excise Tax on PAL Aviation Fuel Importation

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Title Supreme Court: Excise Tax on PAL Aviation Fuel Importation

Law: Boc Memorandum

Decision Date: May 14, 1998

The Bureau of Customs mandates that Philippine Airlines must pay excise tax on imported aviation fuel used for domestic operations, while maintaining tax exemptions for international operations, in accordance with existing tax laws and regulations.

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Excise Tax Liability Based on Fuel Usage

Excise tax treatment depends on whether the fuel is used for international or domestic operations.
For international operations: fuel importation is exempt from excise tax.
For domestic operations: fuel importation is subject to excise tax payment.

Legal Basis for Excise Tax Collection

Excise tax imposition is pursuant to Section 131 of Republic Act No. 8424, known as the Comprehensive Tax Reform Program.
This reaffirms prior Bureau of Customs' memoranda regarding excise tax payment on aviation fuel.

Compliance and Payment Procedures

Bureau of Customs must collect the excise tax upfront before releasing the imported aviation fuel from the port of discharge.
PAL notified that all Jet-A fuel importations are for domestic operations and thus subject to excise tax.

Enforcement and Directive

The instruction for upfront excise tax payment is mandatory and issued for strict compliance by the Bureau of Customs and all concerned parties.
Issued under the authority of the Customs Commissioner Guillermo L. Parayno, Jr. on May 14, 1998.

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