The fiscal incentives rationalization of the CREATE Act has effectively removed the cross-border doctrine for export-oriented registered business enterprises (RBEs). While VAT zero-rating rules on export sales still remain, VAT-zero rating on local purchases are only applicable on purchases that are directly and exclusively used in the RBEs’ registered project or activity.

As such, the BIR released Revenue Memorandum Circular (RMC) No. 24-2022 on March 9, 2022, clarifying that the export-oriented RBE must provide three documents to their local suppliers for VAT-zero rating on local purchases to apply, namely: (1) BIR Certificate of Registration; (2) VAT certification issued by the concerned Investment Promotion Agency (IPA) e.g., PEZA, BOI; and (3) a sworn declaration that the local purchases made forms part directly and exclusively in the registered project.

Further, the BIR issued RMC No. 84-2022 on June 30, 2022 to prescribe the format of the sworn declaration to be furnished by the RBEs to their suppliers. This includes stating, among others, the RBE’s registered business name and registration details with the concerned IPA, its registered project or activity, and whether such local purchase of goods and/or services are allocated to both registered and non-registered projects. Said sworn declaration must also be notarized.

A template of the said sworn declaration is available at the BIR website.

Please be guided accordingly.



P&A Grant Thornton

Certified Public Accountants

P&A Grant Thornton is the Philippine member firm of Grant Thornton International Ltd.


As published in SunStar Cebu, dated 16 August 2022