VAT Ruling No. 012-07

September 26, 2007 VAT RULING NO. 012-07 Sec. 109 VAT Ruling 068-2001, 065-2002 University of Asia and the Pacific Pearl Drive, Ortigas Complex Pasig City Attention: Ms. Emma G. Senica Accounting and Finance Unit Head Gentlemen : This refers to your letter dated 12 October 2006 requesting for a renewal of certificate of exemption from VAT as a non-stock, non-profit educational institution. EcIaTA In support of your request, you submitted photocopies of Certificates issued by the Philippine Association of Colleges and Universities Commission on Accreditation (PACU-COA) showing that the following courses of the University of Asia and the Pacific (UA&P) are accredited by the Commission on Higher Education (CHED), viz: Master of Science in Industrial Economics Program (valid up to October 2010), Master of Arts in Applied Business Economics Program (valid up to October 2010), Master of Arts in Education Program (valid up to October 2010), Master of Business Economics Program (valid up to October 2010), Bachelor of Arts major in Humanities (valid up to May 2009), and a Certification issued by The Federation of Accrediting Agencies of the Philippines showing that UA&P is accredited by the CHED on its Liberal Arts Program which is valid up to May 2009. In reply, please be informed that pursuant to Section 109 (H) of the Tax Code of 1997, as amended, "(E)ducational services rendered by private educational institutions duly accredited by the Department of Education (DepEd), the Commission on Higher Education (CHED), the TESDA and those rendered by government educational institution" shall be exempt from the value added tax. AcHCED Accordingly, the gross receipts derived by UA&P from rendering educational services for courses accredited by the CHED (under a certification issued by the PACU-COA) are exempt from the 12% VAT but only up to school year 2009 and 2010, respectively. Furthermore, this exemption does not extend to your other activities, other than rendering educational services. (VAT Ruling No. 068-2001) (VAT Ruling No. 065-2002) However, the above exemption from the 12% VAT does not extend to its purchase of goods or properties or services and importation of goods. Hence, notwithstanding that UA&P is a non-stock, non-profit educational institution, its purchase of goods or properties or services and importation of goods shall nevertheless be subject to the 12% VAT pursuant to Sections 106, 107 & 108 of the said Code, as amended by R.A. No. 9337. (VAT Ruling No. 119-90 dated May 14, 1990 and BIR Ruling No. DA-043-2004 dated February 4, 2004) 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. aDIHTE Very truly yours, (SGD.) GREGORIO C. CABANTAC Deputy Commissioner