CD: AT&T Communications Services Philippines, Inc. v. CIR

August 27, 2010 at 3:26 pm (2010, Case Digests) (, )

G.R. No. 182364 August 3, 2010
Carpio Morales, J.

Section 113 of the Tax Code does not create a distinction between a sales invoice and an official receipt.

Petitioner filed with the respondent an application for tax refund and/or tax credit of its excess/unutilized input VAT from zero-rated sales. To prevent the running of the prescriptive period, petitioner subsequently filed a petition for review with the CTA.

The CTA held that since petitioner is engaged in sale of services, VAT Official Receipts should have been presented in order to substantiate its claim of zero-rated sales, not VAT invoices which pertain to sale of goods or properties.

Whether or not a Sales Invoice would suffice as a proof for entitlement to a refund of unutilized input VAT from zero-rated sales, even for seller of services

Yes. Section 113 of the Tax Code does not create a distinction between a sales invoice and an official receipt. Parenthetically, to determine the validity of petitioner’s claim as to unutilized input VAT, an invoice would suffice provided the requirements under Sections 113 and 237 of the Tax Code are met.

Sales invoices are recognized commercial documents to facilitate trade or credit transactions. They are proofs that a business transaction has been concluded, hence, should not be considered bereft of probative value (Seaoil Petroleum Corporation v. Autocorp Group, G.R. No. 164326, October 17, 2008). Only the preponderance of evidence threshold as applied in ordinary civil cases is needed to substantiate a claim for tax refund proper (Commissioner of Internal Revenue v. Mirant Pagbilao Corporation, G.R. No. 172129, September 12, 2008).

A taxpayer engaged in zero-rated transactions may apply for tax refund or issuance of tax credit certificate for unutilized input VAT, subject to the following requirements: (1) the taxpayer is engaged in sales which are zero-rated (i.e., export sales) or effectively zero-rated; (2) the taxpayer is VAT-registered; (3) the claim must be filed within two years after the close of the taxable quarter when such sales were made; (4) the creditable input tax due or paid must be attributable to such sales, except the transitional input tax, to the extent that such input tax has not been applied against the output tax; and (5) in case of zero-rated sales, the acceptable foreign currency exchange proceeds thereof have been duly accounted for in accordance with BSP rules and regulations.


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