Proposed Measures in the Philippines: Changes to VAT and Tax Refund Processes

• Senate Bill No. 2224 proposes measures to ease paying taxes in the Philippines.
• The bill suggests removing the requirement to prominently show whether a transaction is VAT-exempt or zero-rated on invoices.
• Purchasers would be allowed to claim input tax even if the invoice lacks certain information, as long as it pertains to the sales and VAT amount, purchaser and seller details, transaction description, and date.
• Sales allowances and discounts granted by VAT-registered individuals could be deducted from gross sales for the quarter.
• Output VAT paid on uncollected receivables may be deducted from the output VAT of the subsequent quarter, but must be added back in case of recovery.
• VAT refund claims would be classified as low, medium, or high-risk based on claim amount, compliance history, and frequency.
• Medium and high-risk claims would be subject to audit.
• The tax authority must act on refund claims within 90 days, and taxpayers can appeal within 30 days if denied.
• If a refund claim is disallowed, only the taxpayer would be liable, without affecting any employee of the tax authority.

Source: kpmg.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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