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

The Philippine Court of Tax Appeals April 24 issued a decision in CTA Case No. 10388, clarifying VAT refunds for zero-rated sales of goods. The taxpayer, a VAT-registered corporation, sought a VAT refund for its sale of goods to Philippine Economic Zone Authority (PEZA)-registered entities, which the taxpayer argued were effectively zero-rated sales. The Commissioner of Internal Revenue (CIR) contended that even though part of the taxpayer’s original claim was refundable and substantiated by documentary evidence, the over-claimed input VAT wasn’t allowed. Upon review, the Court of Tax Appeals, Second Division, denied the taxpayer’s appeal, finding that the taxpayer: 1) ...