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

The Philippine Court of Tax Appeals Dec. 15 issued a decision in CTA EB No. 2992, clarifying unutilized input VAT refunds on zero-rated sales. The taxpayer, a domestic corporation, sought a refund of unutilized input VAT attributable to zero-rated sales. The Commissioner of Internal Revenue (CIR) denied the refund request, contending that the taxpayer failed to prove that its zero-rated sales were valid, given that the recipient of services was conducting business in the Philippines and didn’t qualify for zero-rating. On appeal, the Court of Tax Appeals, en banc, affirmed the denial, finding that: 1) the initial petition was premature ...