RR No. 13-2008: Consolidates regulations on advance Value-Added Tax on the sale of refined sugar and amends and/or revokes all revenue issuances issued to this effect and for other related purposes

Summary

RR No. 13-2008 consolidates the rules on advance VAT on the sale of refined sugar and amends or revokes earlier issuances on the subject. It also sets sugar classification and a monitoring system for mills and refineries.

Key points

1. Refined and raw sugar. Refined sugar has a polarimeter reading of 99.5° and above, and raw sugar has a reading of less than 99.5°. Raw sugar is classified A to E by intended market, such as the U.S. market, the domestic market and the world market.
2. Reports and monitoring. Sugar refineries and mills submit a Weekly Production Report to the RD or RDO where the mill is located, with a copy to the LTS for Large Taxpayers. The BIR assigns a Revenue Officer On Mill Sites (ROOMS) to monitor sugar produced through the quedan register.
3. Advance VAT payment. The owner or seller pays the advance VAT before refined sugar is withdrawn from any refinery or mill. A Declaration for Advance Payment on Refined Sugar is filed first, with the quedan listing and proof of payment attached.
4. Transfers of ownership. When a cooperative or other owner transfers refined sugar in a transaction that does not qualify for the exemption in Section 4, the transferee-owner or seller pays the advance VAT. Payment goes to the RDO where the sugar central is located, before any withdrawal.
5. Tax Credit Certificate for unused payments. Unutilized advance VAT may be the subject of a TCC application filed within two (2) years from the date of filing of the 4th quarter VAT return of the year of payment. Such amounts cannot be carried over, and the TCC does not cover excess Input Tax.
6. Penalties. Failure to file, keep or supply a required list carries a P 1,000.00 penalty per failure, with an aggregate of not more than P 25,000.00 a year. A subpoena duces tecum is issued on the second offense, and a third offense sets criminal prosecution in motion.

Who is affected

• Sugar refineries and mills
• Owners and sellers of refined sugar
• Agricultural cooperatives of good standing

Deadlines and effectivity

• TCC application: within two (2) years from filing of the 4th quarter VAT return

Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.