VAT Ruling No. 074-89

March 29, 1989 VAT RULING NO. 074-89 Eurasia Carriers Company, Inc. 2nd Floor Royal Match Bldg. 2111 Pasong Tamo, Makati, M.M. Attention: Mr . Danilo R . Bautista VP-Controller S i r s : This refers to your letter dated Sept. 24, 1988, inquiring whether your company (which as verbally represented to be engaged in the leasing of an aircraft on an hourly basis) is required to register for value-added tax (VAT). You further represented that since the start of its operations in March 1988, your company has incurred an input tax of P 1,181,208 for the acquisition of the aircraft and would have paid an output tax of P 63,160 based on your billings to your customers. In reply, please be informed of the following: 1. As a lessor of an aircraft on an hourly basis, your company is subject to the 10% VAT on the sale of services pursuant to Sec. 102 of the Tax Code, as amended by E.O. No. 273. 2. Registration for VAT purposes should have been made within 30 days before the start of the business and the filing of returns and payment of tax due within 20 days following the end of each quarter pursuant to Sections 107(b) 110(b) of the same Code, respectively. LLpr 3. The input taxes of P1,181,208 on the purchase of the aircraft may be credited against your output tax of P63,160 pursuant to Sec. 104 of the same Code. The excess of such input taxes which have not been applied against your output taxes may be applied for the issuance of a tax credit certificate or refund pursuant to Sec. 106(c) of the same Code, as they pertain to input taxes paid on capital goods purchased. However, such application for a tax credit certificate/refund must be made not earlier than 180 days from the date of registration or actual start of business operations, whichever comes later, nor later than 2 years from the said dates. Please be guided accordingly. Very truly yours, EUFRACIO D. SANTOS Deputy Commissioner