VAT Refund Denied for Failure to Print "Zero-Rated" on Invoices

The Supreme Court has ruled that a VAT-registered exporter cannot claim a refund of input VAT if its sales invoices do not bear the word —was not among the required invoice contents, whereas the "zero-rated" imprint is expressly required.

Finally, the Court applied the principle that tax refunds are in the nature of tax exemptions, construed strictly against the taxpayer and liberally in favor of the government. The claimant bears the burden of proving entitlement, and Panasonic failed to do so.

Practical Takeaways

• Print "zero-rated" on invoices for zero-rated sales; omission can defeat an otherwise valid VAT refund claim.
• Invoicing rules apply retroactively to the transaction date, not the date of any later law amendment.
• VAT refund claims require strict documentary compliance; the BIR and courts will not relax invoicing requirements.
• Tax refunds are construed strictly against the claimant; the burden of proof rests squarely on the taxpayer.
• Verify the applicable revenue regulations for the relevant period, as requirements may differ from the current NIRC text.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.