Philippines: The Supreme Court ruling and the CREATE MORE Act clarify VAT zero-rating eligibility for domestic market enterprises. DMEs that are high-value, with P15-billion investment or $100-million export sales, may qualify, while others may face 12% VAT on local purchases.
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Manila Times · 8 days ago
Philippines: The Supreme Court has upheld the constitutionality of the VAT refund law for foreign tourists, confirming that the incentive is a valid policy measure to promote tourism. The law allows non-resident foreign tourists to claim VAT refunds on purchases of at least P3,000 per transaction from accredited retailers, provided the goods are taken out of the Philippines within 60 days of purchase.
Deloitte · 8 days ago
Philippines' VAT refund rules have evolved significantly since 1987, with recent changes under the Create More Act affecting zero-rated taxpayers. The Supreme Court clarified processing periods and documentation requirements in December 2025, tightening the 90+30 day rule.
ManilaTimes · 9 days ago
Philippines Supreme Court upholds constitutionality of VAT refund law for foreign tourists, confirming the policy as a valid tourism incentive.
Global Nation · 9 days ago
Philippines Supreme Court declares VAT refund for foreign tourists constitutional, upholding Republic Act No. 12079. The decision affirms the state’s right to offer fiscal incentives to boost tourism without violating equal protection.
GMA News · 9 days ago
Philippines Supreme Court upholds law allowing VAT refunds for foreign tourists on purchases of at least P3,000, valid for goods taken out within 60 days.
Manila Times · 10 days ago
Philippines: The article outlines how VAT refund rules have evolved since 1987, detailing changes in claim periods, documentation, and appeal procedures.
Key Takeaways
In 2025, the Supreme Court ruled that the BIR issuances limiting VAT zero-rating to registered export enterprises were ultra vires, thereby restoring VAT zero-rating eligibility for domestic market enterprises under the CREATE Act.
In 2025, the CREATE MORE Act amended Section 295(D) of the Tax Code to restrict VAT zero-rating on local purchases to high-value domestic market enterprises.
A high-value DME must have P15-billion investment capital or $100-million export sales in the preceding year to qualify for VAT zero-rating on local purchases.
In the Philippines, non-qualified DMEs are subject to 12% VAT on local purchases of goods and services.
Primary source
Read the full article at BusinessWorld OnlineThis summary was published on VATfaqs.com on 15 July 2026. It relates to VAT developments in Philippines. The original source is BusinessWorld Online.
