THE Court of Tax Appeals has affirmed its ruling that denied Carmen Copper Corp.’s refund claim worth P32.16 million allegedly representing its excess value-added tax (VAT) traced to zero-rated sales for the third quarter of 2014.
In a decision dated April 5 and made public on April 17, the CTA full court said the firm failed to prove that its direct-export sales to its foreign clients were paid for in acceptable foreign currency approved by the Bangko Sentral ng Pilipinas.
“We clarified that for a VAT-registered taxpayer claiming VAT zero-rated direct export sales like petitioner, it must present a bank credit advice, certificate of bank remittance, or any other document proving payment of goods in acceptable foreign currency or its equivalent in goods and services,” Associate Justice Lanee S. Cui-David said in the ruling.
The tribunal partially granted Carmen Copper’s petition to review the refund claim last year, agreeing to consider the plea again.
The firm argued that the court should have granted its refund claim since it earlier agreed that the right to due process was violated when the commissioner of internal revenue (CIR) denied the dispute without explaining why.
The tax court disagreed, saying Carmen Copper still had to prove its entitlement to the refund despite the due process violation.
“The court in its decision believes that in spite of the due process violation, the court must still be allowed to proceed with the factual determination of the entitlement of the taxpayer’s claim in a full blown trial,” it said.
“It must be stressed that an applicant for tax refund or credit must not only prove entitlement to the claim but also comply with all the documentary and evidentiary requirements such as VAT invoicing requirements provided by tax laws and regulations.” — John Victor D. Ordoñez
