THE COURT of Tax Appeals (CTA) has denied Nippon Express Philippines Corp.’s claim for a tax refund of over P20 million.
“For the 3rd quarter of taxable year 2018 or the period from July 1, 2018, to Sept. 30, 2019, [Nippon Express] has no unutilized input VAT (value-added tax) attributable to its zero-rated sales which may be the subject of a claim for refund,” the 67-paged decision penned by Associate Justice Marian Ivy F. Reyes-Fajardo read.
The court ruled that to be entitled to a refund, the input VAT claimed must be substantiated by supporting documents.
It added that these documents must comply with the invoicing requirements under the National Internal Revenue Code.
In denying Nippon’s petition, the court said that Nippon had no unutilized input taxes available for refund.
Nippon sought a refund of input VAT worth P20,899,347.46, which constituted a portion of its claimed total allowable input tax amounting to P107,798,471.06.
Nippon claimed input VAT attributable to zero-rated sales amounting to P49,992,599.37 was partially applied against its reported output VAT liability amounting to P29,093,251.91, hence it was seeking a P20,899.347.46 refund.
The court followed the same computation: after deducting the amount of P43,617,528.13 in valid input VAT allocated to VATable sales/receipts from its output VAT liability of P86,899,123.31 on the paid sales/receipts, Nippon has a net output VAT payable of P43,281,595.48.
Since Nippon’s input VAT attributable to VATable sales is not enough to cover its output VAT liability, the valid input VAT attributable to zero-rated sales will be used against the remaining output VAT liability, the CTA said.
However, the court said the valid input VAT attributable to zero-rated sales of P37,722,008.95 is apparently lower than the net output VAT payable of P43,281,595.48.
Thus, the court said Nippon has net output VAT still due amounting to P5,559,586.52. — Chloe Mari A. Hufana
