VAT Ruling No. 042-94

February 8, 1994 VAT RULING NO. 042-94 Section 102 (a) (2)-042-94 Det Norske Veritas Classification A/S Manila Branch Office Attention: Mr . Audun B . Aasheim District Manager S i r s : This refers to your letter dated July 21, 1993 requesting for a ruling as to whether or not you fall under the value-added tax (VAT) zero-rating. It is represented that Det Norske Veritas Classification A/S with VAT registration No. 25-2-005825 is a Manila branch office fully owned by DET Norske Veritas, a non-profit organization founded under Norwegian laws. Det Norske-Veritas Classification A/S is duly registered with the Securities and Exchange Commission, Philippines. The company's primary purpose is to promote safety of lives, environment and values through classification, certification and quality assurance of ships and offshore installations. The former is compensated by the latter for its services in acceptable foreign currency inwardly remitted to the Philippines through an accredited Manila bank in accordance with the Central Bank rules and regulations. In reply, please be informed that based on the foregoing facts, you are engaged in the sale of services. Section 102 of the Tax Code, as amended, provides that services, the consideration of which is paid for in foreign currency remitted inwardly to the Philippines and accounted for in accordance with the rules and regulations of the Central Bank of the Philippines, shall be subject to VAT of 0%. LLphil Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue