VAT Ruling No. 068-92

May 18, 1992 VAT RULING NO. 068-92 NIRC Sec. 100 (a) Precedent Ruling 044-92 VAC Distributors, Inc. 3rd floor JBL Bldg. 150 Panay Avenue, Quezon City Attention: Eleinor M. Andaya Accounting Services Head S i r s : This has reference to your letter dated January 7, 1992 stating that your customer, WALTAC BREEDER FARM, is registered as a non-VAT taxpayer; and that said client invokes its registration as a non-VAT taxpayer to claim exemption from the payment of the 10% VAT on its purchases from you. In reply thereto, please be informed that since VAT is an indirect tax, it can be shifted to the buyer. Once shifted, it becomes an additional cost which the buyers has to pay in order to obtain the goods. The shifting of the VAT does not make such buyer directly liable therefor; hence, your customer is liable for the payment of the passed-on 10% VAT although it is a non-VAT registered taxpayer. Please be guided accordingly. Very truly yours, (SGD.) JOSE U. ONG Commissioner of Internal Revenue