RP, India appeal NY tax case
July 10, 2008
Judge Rakoff last March ruled that the city of New York had a right to collect taxes on portions of buildings used by the three countries for non-diplomatic related purposes in keeping with the 7-2
ruling of the U.S. Federal Supreme Court. Consulates and embassies are usually considered sovereign territory, which makes them generally tax exempt. But Rakoff said it was clearly stated that only the home of the head of a mission is exempted from taxes under the Vienna Convention on Consular Relations and the Vienna Convention on Diplomatic Relations. The Philippines was ordered to pay $10.9-M as tax payments for the portion of a building the Philippine National Bank and the Philippine Airlines occupied. A restaurant that had been situated on the property was determined by the court in February to have served consular purposes and was thus exempt from taxes. Judge Rakoff ordered India to pay $42.4 million to the City of New York and Mongolia to pay $4.3 million.
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