BIR simplifies VAT refunds

MANILA, Philippines — The Bureau of Internal Revenue (BIR) has reduced the requirements that taxpayers need to comply with in order to get their value added tax (VAT) refund.

BIR commissioner Romeo Lumagui recently issued a revenue memorandum circular and revenue memorandum order that would streamline the documentary requirements and procedures in the filing and processing of VAT refund claims.

Lumagui said BIR’s move is in response to the clamor of taxpayer-claimants who encounter difficulties in complying with the documentary requirements previously set.

This is also BIR’s adherence to the Ease of Doing Business Law that aims to streamline the current systems and procedures of government services. It also targets to facilitate prompt actions of all government transactions with efficiency.

The measure will be effective starting July 1.

“We hope that with this, taxpayers will realize that the BIR is now a service-oriented agency, not merely a goal-oriented one. We will continue to look for ways that will make the Philippines a haven for businesses and investments,” he said.

Based on the BIR order, there will be a reduction of the number of documentary requirements from the current 30 to a minimum of nine and maximum of 17.

Taxpayers will no longer be required to submit soft copies of the scanned sales invoices or official receipts in support of both purchases and sales of goods or services.

Instead, taxpayer claimants availing of the VAT refund are only required to submit the original copies of the said documents.

The BIR said that documents that can be verified from the records of the revenue agency either through the existing information tax systems or access to records from other BIR offices are not required anymore.

It also committed to simplify verification and procedures in processing VAT refund claims.

VAT, a form of sales tax, is levied on the sale, barter, exchange or lease of goods or properties and services in the Philippines and on importation of goods into the country.