vat on importation

• Types of Consumption Tax on Importation

  • VAT on Importation
  • Final Withholding VAT
• what is VAT on Importation?

  Consumption tax on the import of goods
• What is Final Withholding VAT?

  Consumption tax on the purchase of services from non-residents
• Object of VAT on Importation goods

  • goods
• What is the object of Final Withholding VAT

  • Object of consumption is services
• Exempt Importation

  • Importation of exempt goods
  • Importation by VAT-exempt persons
  • Quasi-importation
  • Importation which are exempt under special laws and international agreement
• Exempt goods

  • Agricultural and marine food products in their original state
  • Fertilizers, seeds, seedling, fingerlings, fish, prawn, livestock and poultry feeds, including ingredients used in the manufacturing of finished feeds (except of specialty feeds such as dog food)
  • Books and any newspaper, magazine, review, or bulletin which appear at regular intervals with fixed prices for subscription and sale which is not devoted principally to the publication of paid advertisements
  • Passengers or cargo vessels and aircrafts, including engine, equipment and spare parts thereof for domestic or international operations
• VAT-exempt persons

  • International shipping or air transport operators on their import of fuel, goods and supplies
  • Cooperatives of direct farm inputs, machineries and equipment, including spare parts thereof to be used directly and exclusively in the production and or processing of their produce
  • PEZA locators on their import of goods or services
• Quasi-importation

  • Personal and household effects belonging to residents of the Philippines returning from abroad and non-resident citizens coming to resettle in the Philippines
  • Professional instruments and implements, wearing apparel, domestic animals, and personal household effects belonging to persons coming to settle in the Philippines, for their own use and not for sale, barter or exchange
• Factors affecting VAT on Importation

  • Importer is engaged or not engaged in trade or business
  • Importer is a VAT or non-VAT business
  • Importation is for business or personal use
  • Non-resident seller is engaged or not engaged in business
• Tax rate: 12%
• Composition of landed cost

  • Dutiable cost
  • Other in-land cost (Custom duty, Excise tax, Bank charge, Arrastre charge, Documentary stamp tax, Brokerage fee, Wharfage charge, Import processing fees)
• T/F

  
  

  The VAT on importation is a business tax.

  False
• T/F

  
  

  The final withholding VAT is a business tax.

  true
• T/F

  
  

  The VAT on importation is 12% of the value added on importation.

  False
• T/F

  
  

  The VAT on importation is 12% of the receipts from the sale of services abroad.

  False
• T/F

  
  

  Importation is subject to either VAT or percentage tax.

  False
• T/F

  
  

  The final withholding VAT is 12% of the contract price of purchased services from within the Philippines.

  False
• T/F

  
  

  The sale of services abroad is subject to 12% final withholding VAT.

  False
• T/F

  
  

  The Vat on importation is paid to the Bureau of Internal Revenue.

  False
• T/F

  
  

  The final withholding VAT on services is paid to the Bureau of Internal Revenue.

  True
• T/F

  
  

  The importation of any agricultural or marine products is VAT exempt.

  False
• T/F

  
  

  The importation of professional instruments and implements is exempt from VAT.

  True
• T/F

  
  

  The importation of any product intended for human consumption is VAT-exempt.

  False
• T/F

  
  

  The importation of ingredients which are intended for the manufacture of goods for human consumption is VAT-exempt.

  False
• T/F

  
  

  The importation of professional instruments and implements in commercial quantities is VAT-exempt.

  False
• T/F

  
  

  The importation of equipment, machinery and spare parts for marine vessels is VAT-exempt.

  True
• T/F

  
  

  Resident foreigners are not subject to the VAT on importation.

  False
• T/F

  
  

  All agricultural or aquaculture inputs are VAT-exempt.

  False
• T/F

  
  

  The sale of processed agricultural products is vatable.

  True
• T/F

  
  

  The importation of books and newspaper is Vat-exempt.

  True
• T/F

  
  

  The importation of life-saving equipment is VAT-exempt.

  False
• T/F

  
  

  . The lease of aircrafts or vessels from non-residents is exempt from the final withholding VAT.

  TRUE
• T/F

  
  

  The purchase of services from foreign consultants is exempt from final withholding VAT.

  False
• T/F

  
  

  The importation of fuel, goods, and supplies by international carriers is VAT-exempt.

  True
• T/F

  
  

  The importation of agricultural machineries by farmers is exempt.

  False
• T/F

  
  

  The importation of agricultural machineries by agricultural cooperatives is VAT-exempt.

  True
• T/F

  
  

  The VAT on importation is payable only by those engaged in business.

  False
• T/F

  
  

  The final withholding VAT on importation of services is payable even by those not engaged in business.

  False
• T/F

  
  

  The VAT on importation and the final withholding VAT can be claimed as input Vat creditable against Output VAT.

  True