TITLE IV — VALUE-ADDED TAX
prescribed by the Secretary of Finance, upon recommendation of the
Commissioner, be allowed input tax on his beginning inventory of goods,
materials and supplies equivalent to two percent (2%) of the value of such
inventory or the actual value-added tax paid on such goods, materials and
supplies, whichever is higher, which shall be creditable against the output
tax.
(B)
Presumptive Input Tax Credits. — Persons or firms engaged in the
processing of sardines, mackerel and milk, and in manufacturing
refined sugar, cooking oil and packed noodle-based instant meals, shall
be allowed a presumptive input tax, creditable against the output tax,
equivalent to four percent (4%) of the gross value in money of their
purchases of primary agricultural products which are used as inputs to
their production.
As used in this Subsection, the term ‘processing’ shall mean pasteurization,
canning and activities which through physical or chemical process alter
the exterior texture or form or inner substance of a product in such
manner as to prepare it for special use to which it could not have been put
in its original form or condition.
SEC. 112. Refunds or Tax Credits of Input Tax. —
(A)
130
Zero-Rated or Effectively Zero-Rated Sales. — Any VAT-registered
person, whose sales are zero-rated or effectively zero-rated may, within
two (2) years after the close of the taxable quarter when the sales
were made, apply for the issuance of a tax credit certificate or refund
of creditable input tax due or paid attributable to such sales, except
transitional input tax, to the extent that such input tax has not been
applied against output tax: Provided, however, That in the case of zerorated sales under Section 106(A)(2)(a)(1), (2) and (b) and Section
108(B)(1) and (2), the acceptable foreign currency exchange proceeds
thereof had been duly accounted for in accordance with the rules and
regulations of the Bangko Sentral ng Pilipinas (BSP): Provided, further,
That where the taxpayer is engaged in zero-rated or effectively zero-rated
sale and also in taxable or exempt sale of goods or properties or services,
and the amount of creditable input tax due or paid cannot be directly
and entirely attributed to any one of the transactions, it shall be allocated
proportionately on the basis of the volume of sales: Provided, finally, That
for a person making sales that are zero-rated under Section 108(B)(6), the
input taxes shall be allocated ratably between his zero-rated and non-zerorated sales.
Isla Lipana & Co., the Philippine member firm of the PwC network
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