040-98.docx

NPC; Indirect tax exemption - Under Section 13, pars. (a) and (d) of R. A. No. 6395, as amended by P.D. No. 380, National Power Corporation (NPC) is exempt from such taxes, duties, fees, imports and other charges imposed directly or indirectly on all petroleum products used by NPC in its operation. The indirect tax exemption of NPC covers only its purchase of petroleum products to be used in its operation. NPC may not rely upon that provision in order to make its independent contractor similarly exempt from the payment of specific tax by assuming the responsibility of supplying tax-free petroleum products to be used by the independent contractor in its operation. (BIR Ruling No. 040-98 dated April 13, 1998)