VAT Ruling No. 087-89

March 7, 1989 VAT RULING NO. 087-89 Mr. Rodrigo V. Arcilla Jacinto and Jacinto, CPA's Jacinto Bldg. 173 Yakal St. Makati, Metro Manila S i r : This refers to your letter dated November 2, 1988 stating anent that your client is a non-stock, non-profit corporation whose main objective is to help the poor; that it is a registered tax exempt foundation and that one of its business activities is the export and local sale of handicrafts. In this regard, you are requesting a ruling whether you client is exempt from registration and payment of the value-added tax (VAT). In reply, please be informed that your clients' sale of handicrafts is subject to the value-added tax; hence it should register for VAT purposes. Upon registration, your client's export sales are taxed at 0% while local sales are taxed at 10%. However, if the total annual gross sales (aggregate of export and local sales) of your client do not exceed P200,000, your client is exempt from VAT (for both export and local sales) but is subject to 2% percentage tax pursuant to Section 112 of the Tax Code. As such, it shall register as a non-VAT taxpayer in accordance with Revenue Regulations No. 6-88. cdtech Please be guided accordingly. Very truly yours, VICTOR A. DEOFERIO, JR. Deputy Commissioner