Leonardo Vicente & Associates, CPAs
BIR Ruling [DA-429-07] • Bureau of Internal Revenue (BIR) Issuances • Rulings (Unnumbered) • Jul 30, 2007
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July 30, 2007 BIR RULING [DA-429-07] R.R. No. 16-05; 4-2007; DA-367-2007 Leonardo Vicente & Associates, CPAs Unit 55 Zeta II Building, 199 Salcedo Street Legaspi Village, Makati City Attention: Mr. Edgardo A. Leonardo Managing Partner Gentlemen : This refers to your letter dated July 4, 2007 requesting in behalf of your client, Top Amusement Technology International Corporation ("TATIC" for brevity), confirmation of your opinion that the sales in its favor by its local suppliers are subject to value-added tax (VAT) at zero percent (0%) rate. It is represented that TATIC is registered with the Securities and Exchange Commission (SEC) under Registration No. CS200614962 dated September 20, 2006. It was established primarily to provide software related business process outsourcing services, software consulting services and to develop software products. TATIC is registered with the Cagayan Economic Zone Authority under CSEZFP Enterprise No. CF-058 dated January 4, 2007. TATIC is procuring from a VAT-registered supplier its computer equipments and accessories needed in its software development and consulting services. TATIC is also importing goods and merchandise which will be used solely for its operations as a software provider. In reply, please be informed that under Section 4.106-5 (a) (5) in relation to Section 4.106-6 of Revenue Regulations No. 4-2007, sales by VAT-registered suppliers to PEZA registered enterprises are subject to the zero percent (0%) rate VAT. Accordingly, and since TATIC is a CSEZFP registered enterprise, the supply of computer equipments and accessories needed in its software development and consulting services is therefore subject to the zero percent (0%) rate VAT. On the other hand, its importation of goods and merchandise which will be used solely for its operations as a software provider is also subject to the zero percent (0%) rate VAT. (BIR Ruling No. DA-367-2007 dated July 6, 2007) This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered as null and void. CIScaA Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service
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