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

The Philippine Court of Tax Appeals Feb. 5 issued a decision in CTA Case No. 11111, clarifying unutilized input VAT refunds on zero-rated sales. The taxpayer, a domestic corporation, sought a refund of unutilized input VAT attributed to zero-rated sales for Q4 2020. The Commissioner of Internal Revenue (CIR) denied the taxpayer’s refund request, contending that there was no factual or legal basis for the claim. On appeal, the Court of Tax Appeals, Special Second Division, found that: 1) only a portion of the reported zero-rated sales was properly substantiated due to missing certifications, improper nonresident currency documentation, and defective ...