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January 15, 1953

Note: The Agreement entered into force, February 9, 1953.

Reference: This Agreement is also published in 229 UNTS, p. 282.

I

THE PHILIPPINE SECRETARY OF FOREIGN AFFAIRS TO THE AMERICAN AMBASSADOR REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FOREIGN AFFAIRS

Manila, January 15, 1953

Excellency :

I have the honor to refer to my note of December 29, 1952 proposing the exemption of United States military agencies and their instrumentalities including their authorized contractors from the contractor's tax of 3%, the excise or com­pensating tax of 7% and upwards, the foreign exchange tax of 17%, and the import licensing formality and fee of 2% in respect o£ goods and services im­ported by such agencies and instrumentalities from abroad or procured locally from importers, manufacturers and producers either by such agencies and instru­mentalities directly or through the agency of private contractors acting for and in their behalf, provided that such goods and services are exclusively destined for and actually utilized in the construction, operation, maintenance and defense of the bases, and provided further that such exemptions are subject to the con­ditions specified in any note under reference.

A review of my Government's proposal has disclosed that mention of the 17% foreign exchange tax was inadvertently omitted as one of the exemptions also subject to the conditions prescribed before such an exemption may be grant­ed. Accordingly, I have the honor to propose that the opening sentence of the first paragraph on page 2 of my note of December 29, 1952 be amended to incorporate mention of this particular tax as follows: (proposed amendment un­derscored ).

"In case of the contractor's tax of 3%, the excise or compensating tax of 7% and upwards, the foreign exchange tax of 17% and the import licensing formality and fee of 2%, the Philippine Government requires of the United States base commanders concerned or their respective contracting officers, etc."

I would appreciate if Your Excellency's Government could accept the above-indicated amendment of my note under reference and this note together with Your Excellency's concurrence thereto taken as integral parts of the original understanding of our respective Governments regarding these exemptions.

Accept, Excellency, the renewed assurances of my highest consideration.

J. M. ELIZALDE Secretary

His Excellency R. A. SPRUANCE
Ambassador of the United States of America
Manila

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THE AMERICAN AMBASSADOR TO THE PHILIPPINE SECRETARY OF FOREIGN AFFAIRS

THE FOREIGN SERVICE OF THE UNITED STATES OF AMERICA AMERICAN EMBASSY

No. 852

Manila, February 9, 1953

Excellency :

I have the honor to refer to Your Excellency's note dated January 15, 1953 proposing an amendment to the opening sentence of the first paragraph on page two of Your Excellency's note of December 29, 1952 which concerned the exemp­tion of United States military agencies and instrumentalities from certain Philip­pine taxes. The cited paragraph reads as follows (proposed amendment under­scored ):

[See note 7]

I wish to inform Your Excellency that the foregoing amendment is accept­able to my Government which, together with the note under reference, is con­sidered by my Government to be an integral part of the original understanding regarding the exemptions.

Accept, Excellency, the renewed assurances of my highest consideration.

R. A. SPRUANCE

His Excellency JOAQUIN M. ELIZALDE
Secretary of Foreign Affairs
Republic of the Philippines