BIR allows VAT refund before exporters’ zero rating
The Bureau of Internal Revenue (BIR) has allowed qualified export-oriented enterprises (EOEs) to refund value-added tax (VAT) paid while awaiting zero-rating certification from the Department of Trade and Industry (DTI) under transition rules that ran until end-2025.
Under Revenue Memorandum Circular No. 096-2026, the BIR said EOEs may seek refunds for VAT paid on local purchases and importations from Nov. 28, 2024, the effectivity of the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy or Create More Act, until the issuance of their VAT zero-rating certifications.
The refund will be allowed provided that the certification from the DTI-Export Marketing Bureau was issued within the transitory period, which ran from Nov. 28, 2024 to Dec. 31, 2025.
The latest issuance clarifies the refund period amid differences in the dates when EOEs received their zero-rating certifications, which left some qualified enterprises continuing to pay VAT after Create More had taken effect.
“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.
“Our objective is to ensure fair and consistent tax treatment for qualified export-oriented enterprises during the transition to the new zero-rating certification system,” he added.
