VAT Ruling No. 048-90

February 19, 1990 VAT RULING NO. 048-90 107 (e)-332-88-048-90 Sta. Ana Farms, Inc. 117 Dasmarias Street Binondo, Manila Attention: Mr . Cresencio Y . dela Liana Secretary/Treasurer Gentlemen : This refers to your letter dated August 7, 1989 requesting for the cancellation of your VAT Registration No. 23-0-004945 in accordance with Section 19(h) of Revenue Regulations No. 5-87. It was stated in your letter that as a registered member of the National Stud Farm, you are primarily engaged in the business of breeding horses for racing purposes; and that since your gross sales in 1987 was more than P200,000 you registered for VAT purposes in the belief that you are subject to the 10% value-added tax. However, this office ruled (VAT Ruling No. 103(a)-000-00-332-88 dated July 22, 1988) that the sale of a horse intended for training and racing if sold by the breeder himself is exempt from the 10% value-added tax pursuant to Section 103(a) of the Tax Code, as amended; hence, your registration for VAT purposes is considered optional. In reply, please be informed that while VAT Ruling No. 332-88 on the VAT exemption of the sale of race horses is upheld, you are, however, subject to VAT from January 1, 1988 (date of VAT registration) on the basis of your optional registration. Considering further that two years have already lapsed from your date of VAT registration, you can now revert to your exempt status pursuant to Section 18(c)(par. 3) of Revenue Regulations No. 5-87. This can be effected by filing your application for the cancellation of your VAT Regulation Certificate No. 23-0-004945 with the revenue district office where your principal office is located. (Section 19h of RR 5-87) prcd Very truly yours, JOSE U. ONG Commissioner of Internal Revenue