VAT Ruling No. 069-97

October 22, 1997 VAT RULING NO. 069-97 Sec. 4A (e); 068-97; 069-97 Unimer Trading Corporation 6th Floor, Kalayaan Building 164 Salcedo Street, Legaspi Village Makati City Gentlemen : This refers to your letter dated 12 September 1997 asking clarification whether the sale of goods by your company, Unimer Trading Corporation, to Taicon International, Inc., a registered Subic Bay Freeport Enterprises, will qualify for effectively zero-rated VAT pursuant to Section 4A(e) of Revenue Regulations No. 1-95. LexLib It is represented that Unimer Trading Corporation is a VAT registered domestic corporation; that it made sale transactions of its products to Taicon International, Inc., a registered Subic Bay Freeport Enterprise with Certification No. 96-0053 issued by Subic Bay Metropolitan Authority, hence, this request for effective zero-rating. In reply, please be informed that Section 4A(e) of Revenue Regulations No. 1-95, implementing the tax incentives provisions under paragraphs (b) and (c) of Section 12, R.A. 7227, otherwise known as the bases Conversion and Development Act of 1992, provides as follows: "SEC. 4. Exemptions and Incentives . . . . A. ALL SBMA registered enterprises doing business within the Secured Area in the Zone shall enjoy the following: xxx xxx xxx c. Purchases of raw materials, capital goods and equipment and services by the SBMA and SBF accredited enterprises from enterprises in the Customs Territory shall apply for the effectively zero-rated for VAT purposes. However, the VAT-registered enterprises in the Customs Territory shall apply for effective zero-rating of their sales of goods and services to SBF enterprises pursuant to Revenue Regulations No. 5-87, as amended." Accordingly, purchases of services by SBMA and SBF accredited enterprises from your company, UNIMER TRADING CORPORATION, shall be considered effectively zero-rated for VAT purposes. Provided, however, that your company, aside from being VAT-registered, shall apply for effective zero-rating on the sales of goods to SBMA and SBF enterprises in accordance with Revenue Regulations No. 5-87, as amended. (BIR Ruling No. 93-95 dated June 15, 1995). This ruling is being issued to Unimer Trading Corporation 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. Very truly yours, SIXTO S. ESQUIVIAS IV OIC, Assistant Commissioner Legal Service