Export-oriented enterprises may still seek refunds for qualified value-added tax (VAT) expenses incurred while waiting for their zero-rating certification, the Bureau of Internal Revenue (BIR) said.
The clarification covers qualified export-oriented enterprises (EOEs) that incurred VAT on eligible local purchases and importations during the transition to the new VAT zero-rating certification system.
In Revenue Memorandum Circular (RMC) No. 96-2026 issued on September 7, the BIR amended the VAT refund guidelines under RMC No. 37-2025. The new issuance applies to VAT incurred from November 28, 2024, until the date an enterprise receives its Department of Trade and Industry-Export Marketing Bureau (DTI-EMB) VAT zero-rating certification.
To qualify, the certification must have been issued within the prescribed transition period, which ended on December 31, 2025.
“Export-oriented enterprises received their VAT zero-rating certifications on different dates during the transition period,” BIR Commissioner Charlito Martin Mendoza said.
He said the circular provides businesses with clearer rules on how VAT incurred while their certifications were being processed should be treated for refund purposes.
Under the new guidance, qualified EOEs may claim refunds for input VAT attributable to their qualified zero-rated sales, provided they meet the requirements under Section 112 of the National Internal Revenue Code, as amended.
The BIR stressed that refund claims must be properly substantiated and that taxpayers must establish that the input VAT being claimed is directly attributable to qualified zero-rated sales.
VAT that has already been reimbursed, credited, adjusted, recovered from suppliers or otherwise utilized cannot be included in a refund claim.
The tax agency also clarified that EOEs that met the 70-percent export threshold in the preceding taxable year but failed to obtain the required DTI-EMB VAT zero-rating certification are not entitled to a VAT refund for the immediately succeeding year, including during the transition period.
However, unused input VAT from such transactions may be carried over to succeeding taxable quarters and applied against future VAT liabilities, subject to existing tax rules.Mendoza said the measure is intended to provide consistent tax treatment for businesses affected by the shift to the new certification system.
“If they complied with the requirements and their certification was issued within the prescribed period, the VAT they properly incurred while waiting may be refunded in accordance with the law,” he said.
The BIR said the issuance forms part of its efforts to make tax rules more predictable and easier for businesses to comply with.
The agency also linked the measure to the administration’s broader push to improve the business environment, support investment and streamline compliance, consistent with the administration’s tax reform agenda.