VAT on Importation Flashcards
VAT on Importation
Tax on domestic consumption sourced from abroad
Exempt Importations
- Import on Exempt Goods
- Importation by VAT-exempt persons
- Quasi-importation
- Importation exempt under special laws and treaties.
Import of Exempt Goods
- Agricultural and marine food products in their original state.
- Fertilizers, seeds, seedlings and fingerlings, fish, prawn, livestock and poultry feeds including ingredients used in manufacturing of finished feeds.
- Books and any newspaper, magazine, review or bulletin which appear at regular intervals with fixed prices and not for publication of paid advertisements.
- Passengers or cargo vessels and aircrafts, including engine, equipment and spare parts for domestic and international transport
Importation by VAT Exempt Persons
- International shipping or air transport (import of fuel, goods, and supplies)
- Cooperatives of direct fam inputs, machineries and equipment.
- PEZA locators on import of goods or service.
Quasi-importation
- Personal and household effects of residents of Phils. returning from abroad or nonresident citizens resettling.
- Professional instruments and implements for own use and not for sale or barter or exchange (apparel, domestic animals and personal belongings)
Simple processing means:
Acts of:
- Preparation for the market
- Preservation
- Packaging including advanced technological means of packaging
Simple acts of Preparation
- Boiling
- Broiling
- Husking
- Roasting
- Stripping
- Grinding
Simple acts of Preservation
- Freezing
- Drying
- Smoking
- Salting
Acts of Packaging
Packaging
- not processing
- does not alter the nature of goods.
- merely involves putting product in a medium for convenience of handling, storage or marketing.
Goods still in their original state even if packaged with advanced technological means
- Shrink wrapping in plastic
- Vacuum packing
- Tetra-packing
- Other similar packaging methods
Scope of VAT on Importation
VAT applies on all importations not exempted
The importer is:
- engaged in business.
- VAT or NON-VAT registered
- importation is for business or personal use
- nonresident seller is engaged in business
Basis of VAT on Importation
Landed cost.
Landed cost is composed of:
- Dutiable Value
- Custom duty
- Excise Tax
- Bank charge
- Brokerage fee
- Arrastre charge
- Wharfage dues
- DST
- Import processing fees
Final Withholding VAT
Tax on domestic consumption of services purchased from abroad
Criteria:
- Services is rendered within
- Service provider is NRA or NRFC
- Payor is the withholding agent (engaged in business or practice of profession or a Corp.)
