PEZA asks incoming DTI chief to reconcile VAT exemption for RBEs
A formal letter was sent by the Philippine Economic Zone Authority (PEZA) to incoming Department of Trade and Industry (DTI Secretary Alfredo Pascual requesting him to reconcile the existing value added tax (VAT) exemption for its registered enterprises.
This comes as the Bureau of Internal Revenue (BIR) released an advisory lifting such VAT free status.
PEZA Director General Charito Plaza disclosed that they have requested an advanced meeting with Pascual so he can hear their sentiments and suggestions for the next administration’s economic agenda.
PEZA Deputy Director General Tereso Panga also noted the different interpretation of the Department of Finance (DOF) when the BIR issued a revenue regulation lifting the VAT exemption on PEZA firms’ purchases from the local market.
During the last hearing in Congress, Panga noted that ways and means committee chairman Joey Salceda categorically stated that the Implementing Rules and Regulations (IRR) of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law went actually beyond the intent and spirit of the law in exempting PEZA firms from the 12% VAT on their local purchases.
“Therefore, the IRR being made as a basis for crafting the Revenue Memorandum Circular would appear that these MCs are flawed and void from the beginning,” said Panga.
With that, Panga said that PEZA would like to request the incoming administration to request them to revisit and reconsider the agency’s position that there was a big mistake in the MCs.
The BIR issued Revenue Regulations (RR) No. 9-2021 stating that a 12% VAT to certain sales which were previously exempted. This RR implements the provisions of Republic Act (RA) No. 10963 or the Tax Reform and Acceleration and Inclusion (TRAIN) Act.
