April 22, 2009
VAT RULING NO. 006-09
Sec. 4.108-5 (a); RR 16-2005; RR 4-2007; DA-376-2006
Asecasia Incorporated
12/f Asian Star Bldg.
Filinvest Corporate City
Alabang, Muntinlupa City
Attention: Hector E. Juliano
Accounting Manager
Gentlemen :
This refers to your letter dated April 23, 2007 requesting for a ruling as to whether or not your VAT zero-rated status may exempt you from the 12% VAT your suppliers impose on their sales to you. ACTIHa
It is represented that Asecasia Incorporated ("Asecasia" for brevity) is a firm engaged in encoding services, rendering services to foreign clients, and is paid by these clients in foreign currency. It is further represented that by virtue of BIR Ruling DA-376-2006, dated June 6, 2006, Asecasia's sales of encoding services to its foreign clients were found to be VAT zero-rated, pursuant to Section 4.108-5 (b) (2) of Revenue Regulations (RR) No. 16-2005.
Apparently, Asecasia now claims that since the above encoding services were entitled to VAT zero-rating, its input tax on its purchases from its suppliers only accumulates with no output VAT to offset the former. Furthermore, the only way it could seemingly recover...
