BIR Ruling No. 533-2017

BUREAU OF INTERNAL, REVENUE RFI'BLKOTHF PHIPPINES DEPARTMENT OY FINANGE Quczon City

Bureau of Internal Revenue Ruling

Sec.109(1)(G) NIR( of 1997. as amended: Sec. 4.109-1(B)(1) A Person to Contact: Chief. Law Division Tel. Nos. 926-55-36 / 927-09-63 (g). RK No. 16-2005 Date: Novemb er

Fxchange Road, Ortigas Center. Pasig City SANTOS PARUNGAO AOUINO & SANTOS LAW OFFICES Suites 706 & 707 West Tower, Philippine Stock Exchange Centre.

Attention: ATTY. AGATHA ZAPANTA-DE JESUS Gentlemen:

MEDICAL, INC. (NVision), relative to your request for clarification as to the scope. Code of 1997. as amended, in relation to Revenue Regulations No. 16-2005 otherwise Revenue Regulations No. 4-2007. Legal Division, Revenue Region No. 07. Quezon City. on behalf of the NVISION interpretation. and application of Section 109 (1) (G) of the National Internal Revenue known as the Consolidated Value-Added Tax Regulations of 2005. as amended by T'his refers to your follow-up letter dated July 23. 2015. as indorsed by the Chief

and. therefore. exempt from payment of 'V AT. field testing, electrocardiography. refraction, ophthalmic services, and other laboratory tests not performed by medical doctors, fall within the coverage of medical services In your letter, you asked in particular whether or not diagnostic tests like visual

Revenue Code of +997. as amended, provides that: In reply, please be informed that Section 109 (1) (G) of the National Internal

trom the vulue-udded tux: of Subsection (2) hereof. the following transactions shall be exempt "SE(. 109. Exempt Transactions. - (1) Subject to the provisions

XXX xXX XXX

G. Medicul. dental, hospital and veterinary services except those rendered hy professionals:

XXX XXX XXX

2005, as amended by Revenue Regutations No. 4-2007, states that: In relation thereto. Section 4.109-1 (B) (1) (g) of Revenue Regulations No. 16-

"SE(. 4.109-1. VAT-Exempt Transactions. -

NVISION MEDICAL, INC 3017 11-17-X77

XXX XXX XXX

the vulue-udded tax: Subsecrion (2) hereof. the following transaciions shall be exempt from (B) Exempt Transactions - (I) Subject to the provisions of

XXX xXX XXX

E Medical. dental. hospital and veterinary servicess except those rendered hy professionals:

Laboratory services are exempted. xxx xxx .xxx"

is in accordance with one of the Latin phrases in statutory construction which states Services are considered transactions exempt from VAT. The law did not distinguish whether such laboratory services are to be'performed bv medical doctors or not to be VAT exempt. When the law does not distinguish, neither should we distinguish. This that: Based on the express provisions of the foregoing, it is clear that laboratory

Iaw does not distinguish, we must not distinguish). "ubi lex non distinguit nec nos distinguire debemus " (when the

provider. NVision shall not pass on the VAT to its clients because said transactions are services. and other laboratory tests not performed by medical doctors. As service this Office hereby confirms that these are considered exempt from VAT. This includes diagnostic tests like visual fieid testing, electrocardiography. refraction. ophthalmic not subject to VAT. Thus, insofar as the rendition of iaboratory services by NVision is concerned.

cxempt from VAT shall depend on how it is provided. The process of diagnosis is defined as the discovery of the source of a patient's illness or the determination of the nature of his disease from a study of its symptoms. The conduct of diagnostic service both diagnostic and laboratory services as a package) or by an independent professional may either be carried out by an employec of NVision (the service fee is payment for (consultants). However, in relation to the conduct of diagnostic services, whether such is also

Code of 1997. as amended, which provides. viz.: shall be exempt from VAT pursuant to Section 109 (1) of the National Internal Revenuc The conduct of diagnostic service when done through the employees of NVision

from the value-added tux: of Subsection (2) hereof. the following transactions shall be exempt "SEC. 109. Exempt Transactions. - (1) Suhject to the provisions

XXX XXX XXX

(l) Services rendered by individuals pursuunt to un employer-employee relationship:

XX XXX XX.

t'rtle Aduxu vs. Aholos. G.R No. 168617. Fehruar, 19, 2007, 516 SCRA 261. 280: Phritippine Free Press. inc. vs. ('otrt o) Appeals. (i.R. No 132863. (xctober 24. 2005.473 Sc:RA 639.662

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NYISON MEDICAL. INC #533-2017 11-17-2017

professional (consultant). sha!l appropriately be subject to VAT. On the other hand, diagnostic services. when rendered by an independent

of 1997. as amended. [BIR RULING fDA-{VAT-108}] 750-09] diagnostic services of NVision except those rendered by independent professionals are exempt from VAT pursuant to Section 109 (1) of the Nationat Internal Revenue Code In vicw thereof. this Office is of the opinion as it hereby holds that laboratory :

However. if upon investigation, it will be disc!osed that the facts are different. then this ruling shall be considered null and void. This ruling is being issued on the basis of the foregoing facts as represented.

Very truly yours.

Commissioner of Internal Revenue CAESAR R. DULAY 011205

K-I-LMAT

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