Tax Assignment
Tax Assignment
Tax Assignment
Abenda
3E1-BS Accountancy
What is VAT?
According to (Tabag, E., & Garcia, E. J., 2019) VAT or the Value Added Tax is a tax on the
value added by every seller to the purchase price or cost in the sale or lease of goods, property
or services in the ordinary course of trade or business as well as on importation of goods into
the Philippines, whether for personal or business use. It is a tax on consumption levied on the
sale, barter, exchange or lease of goods, or properties and services in the Philippines levied at
each stage of production and distribution process. (RR 4-2007) “Cross border doctrine” means
that no VAT shall be imposed to form part of the cost of goods destined for consumption
outside the territorial border of the Philippine Taxing Authority. As a rule, sale of goods or
services made in the normal course of trade or business are subject to vat “unless exempt”.
Nonetheless, if the sale is exempt from vat, it is may be subject to other percentage taxes
except those transactions exempt from business taxes such as those made for subsistence or
livelihood. (Tabag, E., & Garcia, E. J., 2022)
Kinds of VAT
● VAT on sale of goods or properties
● VAT on importation of goods
● VAT on sale of services and use of lease or properties
References:
Tabag, E., & Garcia, E. J. (2019). Transfer & Business Taxation with Special Topics
(2019th ed., p. 207) [Review of Transfer & Business Taxation with Special Topics]. EDT
Bookshop.
Tabag, E., & Garcia, E. J. (2022). Transfer & Business Taxation with Special Topics
(2022nd ed.) [Review of Transfer & Business Taxation with Special Topics]. EDT
Bookshop.