BIR Ruling [DA-188-00]

March 30, 2000 BIR RULING [DA-188-00] Takasago Import-Export Corporation (Phils.) Rm. 207-A Bonaventure Plaza Ortigas Avenue, Greenhills San Juan, Metro Manila Attention: Ms . Eva M . Sobrevilla Administrative Officer Gentlemen : This refers to your letters dated June 15 and September 8, 1999 concerning your request to apply your excess input VAT for 1997-1998 to your Corporate Quarterly Income Tax. It is represented that you are a service company receiving from abroad fixed service fee budget every year to be used for your operating expenses; and that you are not declaring output tax on your zero-rated sales of goods/services. In reply, please be informed that an automatic tax credit of excess input tax against your corporate income tax liability is not allowed in this jurisdiction. However, as a VAT-registered taxpayer you are entitled to input taxes on your domestic purchases of goods/services made in the course of trade or business which you may use in paying your output VAT. However, you may apply for the issuance of a Tax Credit Certificate of the input taxes paid attributable to your zero-rated or effectively zero-rated sales or on capital goods imported or locally purchased to the extent that such input taxes have not been applied against output taxes subject to the filing of an application for tax credit certificate with the Revenue District Officer having jurisdiction over your principal place of business within 2 years after the close of the taxable quarter when the purchase or importation was made. We are, therefore, returning to you herewith the pertinent papers regarding your request so that you can file the same with the appropriate Revenue District Officer. Very truly yours, Commissioner of Internal Revenue By: (SGD.) SIXTO S. ESQUIVIAS IV Deputy Commissioner (Legal and Enforcement Group)