Qualified export-oriented enterprises (EOEs) may claim refunds on value-added tax (VAT) paid on eligible local purchases and importations while waiting for the issuance of their Department of Trade and Industry-Export Marketing Bureau (DTI-EMB) VAT zero-rating certifications during the transitory period, the Bureau of Internal Revenue (BIR) said on Wednesday.
In a statement, the BIR said it issued a Revenue Memorandum Circular (RMC) on Sept. 7, amending the VAT refund guidelines under RMC 37-2025.
It covers VAT incurred on local purchases and importations attributable to qualified zero-rated sales beginning Nov. 28, 2024, and before the enterprise received its DTI-EMB certification, provided that the certification was issued with the prescribed transition period ending Dec. 31, 2025.
The issuance supports the BIR’s continuing efforts to make tax administration clearer and more predictable for businesses, and is also in line with President Ferdinand R. Marcos Jr.’s direction to improve the business environment.
“Export-oriented enterprises received their VAT zero-rating certifications on different dates during the transition period. We are clarifying how VAT incurred while these certifications were being processed should be treated so qualified export-oriented enterprises will have a clear basis for their refund claims,” BIR Commissioner Charlito Mendoza said.
Mendoza said they aim to keep tax treatment fair and consistent for qualified export businesses as they move to the new zero-rating certification system.
“If they complied with the requirements and their certification was issued within the prescribed period, the VAT they properly incurred while waiting may be refunded in accordance with the law,” he added.
The BIR, however, clarified that the refund is still subject to the requirements under Section 112 of the National Internal Revenue Code.
Proper substantiation and proof that the input VAT is directly attributable to qualified zero-rated sales is still needed.
VAT that has already been reimbursed, credited, adjusted, recovered from suppliers, or otherwise utilized may not be the subject of a VAT refund claim.
EOEs that attained the 70 percent export threshold from the preceding taxable year but failed to secure the required DTI-EMB VAT zero-rating certification, including during the transition period, are not entitled to a VAT refund covering the immediately succeeding year.
The BIR said any unused input VAT may be carried forward to subsequent taxable quarters and utilized against future VAT liabilities in accordance with existing tax rules. (PNA)