VAT Ruling No. 043-00

October 23, 2000 VAT RULING NO. 043-00 Sec. 109 (c) VAT Ruling Nos. 116-88 393-88 Hua San Wan Foodmart, Inc. 637-639 Elena Street Binondo, Manila Attention: Mr . Go Chin Hua Manager Gentlemen : This refers to your letter dated April 16, 1999 to the Department of Finance requesting that your importation of 180 poly Jute Bags of groundnut which arrived in Manila on April 16, 1999 on board MV Ming Victory V30N under B/L No. 1430602 be exempted from the payment of the value-added tax (VAT), being an agricultural food product. In reply, please be informed that such importation is exempt from VAT pursuant to Section 109(c) of the Tax Code of 1997 which states, viz: "SEC. 109. Exempt Transactions . The following shall be exempt from the Value-Added Tax: "(a) . . . "(b) . . . "(c) Sale or importation of agricultural and marine food products in their original state, livestock and poultry of a kind generally used as, or yielding, or producing foods for human consumption; . . . "Products classified under this paragraph . . . shall be considered in their original state even if they have undergone the simple processes of preparation or preservation for the market, such as freezing, drying, salting, broiling, roasting, smoking or stripping. . . ." (VAT Ruling Nos. 116-88 dated April 30, 1988 and 393-88 dated August 25, 1988) It must be understood that to be exempt from VAT, the subject groundnut must be in its original state as defined above. The said importation, however, shall require an Authority to Release Imported Goods (ATRIG) to be issued by the Revenue District Officer having jurisdiction over the port of entry of the imported goods. This ruling is being issued based on the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. SIcEHD Very truly yours, Commissioner of Internal Revenue By: (SGD.) LILIAN B. HEFTI Deputy Commissioner Legal & Inspection Group