Connect with us

Hi, what are you looking for?


Tax court affirms partial refund of KEPCO’s excess VAT


THE Court of Tax Appeals (CTA) has affirmed its ruling partially granting KEPCO Ilijan Corp.’s refund claim worth P23.39 million representing its excess input value-added tax (VAT) traced to its zero-rated sales of electricity to the National Power Corp. for the period covering three quarters of 2002.

In a 16-page decision dated Jan. 9 and made public on Jan 11, the CTA full court upheld its second division’s ruling that said P23.39 million out of the firm’s P74.66 million claim was backed by official receipts.

“At the outset, a tax credit or refund, like tax exemption, is strictly construed against the taxpayer,” the tribunal said. “The taxpayer claiming the tax credit or refund has the burden of proving that he is entitled to the refund or credit.”

It disqualified some transactions from zero-rated sales since KEPCO failed to write its Taxpayer Identification Number (TIN) in some receipts for the second, third and fourth quarters of 2002.

Under the law reforming the energy industry, power generation companies are entitled to zero-rated sales of electricity that do not translate to any output tax.

The country’s revenue code requires a taxpayer to indicate in its receipts that it is a VAT-registered entity. Receipts should also contain the entity’s Taxpayer Identification Number.

The term “zero-rated” must be written on its official receipts to avail of the incentive.

KEPCO manages the Ilijan gas-fired power plant, which is the largest natural gas facility in the country. It gets its fuel from the Philippines’ only indigenous gas field.

Citing Supreme Court jurisprudence, the CTA said official receipts issued in a name approved and authorized by the Securities and Exchange Commission must be considered non-compliance with regulations of the country’s tax code.

The tax tribunal also denied the commissioner of internal revenue’s (CIR) appeal to overturn the refunded amount, as it said the CTA Second Division correctly determined that the power firm successfully proved its entitlement to the reduced amount.

“The CIR failed to point out the specific invoices and official receipts which should have been disallowed,” the court said.

“Bare allegations which are not supported by any evidence, documentary or otherwise, sufficient to support a claim, fall short to satisfy the degree of proof needed.” — John Victor D. Ordoñez

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



Bed Bath & Beyond Inc. said on Monday it was planning to raise some $1 billion through an offering of preferred stock and warrants in a last-ditch effort to stave off bankruptcy....


REUTERS After a robust start to the year, the Philippine stock market is losing steam, as investors worry rising inflationary pressures and higher interest...

Editor’s Pick

<?xml encoding=”utf-8″ ??> A senior Bank of England policymaker has warned the central bank could be forced to keep raising interest rates to prevent...


The New York Stock Exchange (NYSE) on Monday said it plans to reimburse investors who incurred losses due to a trading glitch last month that caused widespread confusion and resulted...


WASHINGTON – Boeing Co. expects to cut about 2,000 white–collar jobs this year in finance and human resources through a combination of attrition and layoffs, the US airplane maker confirmed Monday. Last month, the Arlington, Virginia-based company announced it would hire...


L FILIPE C SOUSA-UNSPLASH WASHINGTON – Many airlines will be unable to meet looming US deadlines to retrofit airplane altimeters to ensure they are not susceptible to 5G wireless interference, the world’s biggest airline trade...

You May Also Like


COVID-19 has had a significant impact on the mental health of Filipinos across different groups all over the archipelago. From frontline workers, parents balancing...


REUTERS By Luz Wendy T. Noble, Reporter The country’s foreign exchange buffers slightly increased as of end-October as the value of the central bank’s...


BW FILE PHOTO GROSS BORROWINGS by the National Government reached P2.6 trillion as of end-September as it continued to raise funds to respond to...


KARASOLAR.COM TENA, Ecuador — Ecuador’s rainforest Achuar people say their ancestors long dreamed of a “fire canoe” or “electric fish” that would let them...

Disclaimer: Respect, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 Respect Investment. All Rights Reserved.