Philippine Exporters Can Claim VAT Refunds While Awaiting Certification
The Bureau of Internal Revenue issued new guidelines on September 7, allowing export-oriented enterprises to recover Value-Added Tax on purchases made before receiving zero-rating status. This applies to VAT incurred from November 28, 2024, through December 31, 2025.
New Refund Guidelines Issued
The Philippine Bureau of Internal Revenue (BIR) has clarified that export-oriented enterprises (EOEs) can now claim Value-Added Tax (VAT) refunds on eligible local purchases and imports. This applies to periods when these businesses were awaiting their zero-rating certification from the Department of Trade and Industry (DTI).
BIR Commissioner Charlito Martin Mendoza issued Revenue Memorandum Circular (RMC) 96-2026 on September 7, updating previous VAT refund guidelines under RMC 37-2025. This move aims to provide a clear framework for exporters during the transition to a new certification system.
Specific Period Covered
The updated guidelines specifically address VAT incurred on local purchases and importations linked to qualified zero-rated sales. This covers the period starting November 28, 2024, and extending until an enterprise received its DTI-Export Marketing Bureau certification.
A key condition is that the certification must have been issued within the transition period, which concluded on December 31, 2025. All refund claims remain subject to Section 112 of the National Internal Revenue Code, requiring proper substantiation and proof that the input VAT directly relates to qualified zero-rated sales.
Exclusions and Carry-Forward Rules
The BIR clarified that VAT amounts already reimbursed, credited, adjusted, or recovered from suppliers are not eligible for a refund claim.
Furthermore, EOEs that met the 70 percent export threshold in the preceding taxable year but failed to secure the necessary DTI-Export Marketing Bureau certification, even during the specified transition period, will not qualify for a VAT refund in the immediately succeeding year.
In such cases, any unused input VAT may instead be carried forward and applied against future VAT liabilities, adhering to existing tax regulations.
This policy clarification offers significant support for Philippine export-oriented businesses. It provides a consistent and clear basis for claiming VAT refunds, which can improve cash flow management for companies that incurred VAT while their zero-rating certifications were being processed.
By reducing the financial burden during this transitional phase, the measure helps maintain the competitiveness of Philippine exports. This is particularly relevant for businesses operating within regional supply chains, as it can lower their overall operational costs and enhance their ability to compete in Asian markets.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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