CTA denies P18.7-M tax refund sought by Nippon Express PH
The Court of Tax Appeals (CTA) has denied the petition of Nippon Express Philippines Corporation for a tax refund of P18.7 million from the Bureau of Internal Revenue (BIR).
Nippon Express filed an application for tax credits or refunds before the BIR on July 13, 2020 in the amount of P18,748,240.85, which, it claimed, is attributable to its zero-rated sale of services for the first quarter of 2018.
However, the application was denied by the BIR on Nov. 4, 2020 for lack of factual and legal basis.
Aggrieved, Nippon Express -- a firm engaged in global warehouse and stock management, transport services and other businesses -- elevated the case to the CTA via a petition for review on Dec. 4, 2020 and argued that the tax refund should have been granted because all the necessary elements are present.
It claimed that it rendered services to non-foreign corporations (NRFCs) not doing business in the Philippines, which were duly paid for and inwardly remitted to the Philippines in acceptable foreign currency and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP).
Thus, it said the revenues it obtained as VAT-registered taxpayers are subject to VAT at zero-rated percent rate pursuant to the National Internal Revenue Code (NIRC) of 1997, as amended.
In denying the petition, the CTA said that Nippon Express failed to establish that it had valid zero-rated or effectively zero-rated sales for the first quarter of 2018.
"The Court observed that petitioner (Nippon Express) did not indicate the nature of the services in the official receipts but only the phrase 'various invoices' or certain reference numbers for which the payments received by petitioner were made," the tax court said.
It also said: "Unfortunately, petitioner did not submit in evidence the said invoices, which could have been cross-referenced with the ORs and provided the necessary data that will confirm the nature and details of the supposed zero-rated sales. Consequently, the Court cannot ascertain on its own whether the payments received are indeed for the claimed services rendered by petitioner."
The 20-page decision promulgated last Feb. 27 was written by Associate Justice Corazon G. Ferrer-Flores with the concurrence of Associate Justice Ma. Belen M. Ringpis-Liban and Maria Rowena Modesto-San Pedro.