VAT Ruling No. 007-93

February 12, 1993 VAT RULING NO. 007-93 Section 102 (a) 102 (u) 095-92 203-92 007-93 Export Processing Zone Authority 4th Floor, Legaspi Towers 300 Roxas, Boulevard, Metro Manila Attention: Mr . Tagumpay R . Jardiniano Administrator Gentlemen : This has reference to your letter dated November 19, 1992 requesting for a clarificatory ruling on a provision of Revenue Memorandum Order (RMO) No. 22-92 particularly on the VAT exemption/zero-rate status accorded on the sale of various domestic merchandise to EPZA-registered firms. In reply, please be informed that RMO No. 22-92 explicitly states that only the sale to EPZA-registered firms of raw materials which shall form part of the finished goods eventually exported can qualify for effective zero-rating. On the other hand, sale of goods (e.g. materials which will not form part of the finished goods to be exported) the EPZA-registered firms are exempt from VAT pursuant to Section 103(u) of the Tax Code, in relation to Article 77(1) of the Omnibus Investment Code of 1987 (E.O. No. 226). Furthermore, sale of services to EPZA-registered firms shall be subject to the 10% VAT in accordance with Section 102(a) of the Tax Code. Please be guided accordingly. prcd Very truly yours, JOSE U. ONG Commissioner of Internal Revenue