BIR Ruling No. 483-12

July 30, 2012 BIR RULING NO. 483-12 Section 105 of the Tax Code of 1997, as amended; and RMC No. 76-03; BIR Ruling No. 104-10 Church of God World Missions of the Philippines, Inc. Dr. Lovell R. Cary, ACCM Building 102 Valero Street, Salcedo Village, Makati City Attention: Bishop Roberto M. Tuazon Corporate Secretary Gentlemen : This refers to your letter dated April 12, 2012 ,requesting on behalf of Church of God World Missions of the Philippines, Inc. (CGWMPI) for the issuance of a certificate of Value Added Tax (VAT) exemption. ICHcTD It is represented that CGWMPI is a non-stock, non-profit religious organization duly registered with the Securities and Exchange Commission under S.E.C. Registration No. 122595 and with Tax Identification Number 000-444-478-000. In reply, please be informed that Revenue Memorandum Circular No. 76-03 dated November 14, 2003 clearly defines the tax exemptions of non-stock, non-profit corporations under Section 30 of the Tax Code of 1997, as amended, to wit: "NON-STOCK, NON-PROFIT CORPORATIONS Organizations enumerated under Section 30 of the Tax Code of 1997 are exempt from the payment of income tax on income received by them as such organization."(emphasis supplied) As clearly provided in the above quoted provision, the exemption of a non-stock, non-profit corporation is limited to income tax. Moreover, this Office ruled in BIR Ruling No. 104-10 dated October 14, 2010 that Value-added tax (VAT) is an indirect tax, payable by the seller and not by the purchaser of goods or services. Being an indirect tax, the amount of the tax may be shifted or passed on to the buyer, transferee or lessee of the goods, properties or services (Section 105, Tax Code of 1997, as amended). Once shifted, it is no longer a tax but an additional cost which the purchaser has to pay to obtain the goods or services. In view hereof, your request for the issuance of a certificate of VAT exemption is denied for lack of legal basis. Very truly yours, (SGD.) KIM S. JACINTO-HENARES Commissioner of Internal Revenue