VAT exemption of international carriers (Revenue Regulations No 15- 2015)
The list of transactions classified in Section 4.109-1 of Revenue Regulations 16-2005 as VAT-Exempt has been amended as follows:
- Inserted a new subsection (S) for transport of passengers by international carriers doing business in the Philippines. The same Subsection (S) clarified that transport of cargoes by international carriers doing business in the Philippines are VAT exempt pursuant to Section 109(1)(E) of the Tax Code since the same is subject to the percentage tax on common carriers under Section 118. It is noted that these are pursuant to the amendments under Republic Act No 10378 (March 7, 2013) which rationalized the taxation of international carriers.
- Old Subsection (S) to (W) have been renumbered accordingly.
- Under new Subsection (T), VAT exemption of sale, importation or lease of passenger or cargo vessels and aircraft for domestic or international transport operations shall now be subject to the requirements on restriction on vessel importation and mandatory vessel retirement program of the MARINA.
The RR was published on Dec. 29, 2015 and will take effect 15 days later.