Philippines Court of Tax Appeals Issues Decision Clarifying Unutilized Input VAT Refunds on Zero-Rated Sales

The Philippine Court of Tax Appeals March 18 issued a decision in CTA EB Nos. 3062 and 3066, clarifying unutilized input VAT refunds on zero-rated sales. The taxpayer, a VAT-registered, sought a refund of excess and unutilized input VAT attributable to zero-rated sales for 2019, which the Commissioner of Internal Revenue (CIR) partially denied for improper input VAT allocation, failure to prove non-utilization, and invoicing noncompliance. On appeal, the Court of Tax Appeals, en banc, found that: 1) input VAT may be proportionately allocated when it isn’t possible to directly attribute zero-rated sales; 2) the amended return showed unutilized input ...