Bio Standard Corporation

December 12, 2008 BIR RULING [DA-(VAT-053) 520-08] DA 678-06 Bio Standard Corporation Lot 4, 1296 E. Delos Santos Avenue Apolonio Samson, D2, Quezon City Attention: Ms. Juliet Pieza CEO Gentlemen : This refers to your letter dated November 3, 2008 stating that your company is registered with the Securities and Exchange Commission (SEC) under SEC Registration No. CS200809180 dated July 29, 2008; that it is registered with the BIR as a value-added tax (VAT) entity; and that it is primarily organized to engage in, conduct and maintain the business of buying or otherwise dealing in, at wholesale of such goods as used cooking oil and other goods related to or of similar nature; and that it is in the process of exporting the said used cooking oil to other foreign countries. Based on the foregoing representations, you now request for an opinion on whether or not the export of used cooking oil is subject to VAT at zero percent (0%) pursuant to Section 4.106-5 (a) (1) of Revenue Regulations No. 16-2005, as amended. In reply thereto, please be informed that Section 4.106-5 (a) (1) of Revenue Regulations No. 16-2005, as amended, provides that "SEC. 4.106-5. Zero-Rated Sales of Goods or Properties. A zero-rated sale of goods or properties (by a VAT-registered person) is a taxable transaction for VAT purposes, but shall not result in any output tax. However, the input tax on purchases of goods, properties or services, related to such zero-rated sale, shall be available as tax credit or refund in accordance with these regulations. The following sales by VAT-registered persons shall be subject to zero-percent (0%) rate: TcEAIH (a) Export Sales. "Export Sales" shall mean: (1) The sale and actual shipment of goods from the Philippines to a foreign country, irrespective of any shipping arrangement that may be agreed upon which may influence or determine the transfer of ownership of the goods so exported, paid for in acceptable foreign currency or its equivalent in goods or services, and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP)." Accordingly, this Office holds that your export of used cooking oil is governed by the afore-quoted Section 4.106-5 (a) (1) of Revenue Regulations No. 16-2005, as amended. Thus, you are entitled to the benefit of the zero percent (0%) VAT provided the conditions described above are met. 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 null and void. HITEaS Very truly yours, (SGD.) JAMES H. ROLDAN Assistant Commissioner Legal Service