VAT Ruling No. 019-96

September 23, 1996 VAT RULING NO. 019-96 Sec. 99-000-019 Mrs. Benedita S. Lago 862 Violeta St., Blk. 20 Queen's Row West, Bacoor, Cavite M a d a m : This refers to your letter dated March 18, 1996, inquiring whether or not the VAT being passed on to you as a subscriber of Smart Communications, Inc., is in accordance with the VAT guidelines. In reply, please be informed that beginning January 1, 1996, services of franchise grantees of telephone and telegraph, radio and television broadcasting shall be subject to VAT pursuant to Section 100 of the Tax Code, as amended by Republic Act No. 7716 (Expanded Value-Added Tax Law), as implemented by Revenue Regulations No. 7-95. VAT is payable monthly by the seller of goods, properties or services, i.e. Smart Communications, Inc., as the franchise grantee and seller of telecommunication service. VAT being an indirect tax, the amount may be shifted or passed on to the buyer, transferee or lessee of the goods, properties or services in accordance with Section 99 of the Tax Code, as amended. Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue