BIR Allows VAT Refund Claims for Exporters During Transition Period

MANILA, Philippines — The Bureau of Internal Revenue (BIR) has allowed qualified export-oriented enterprises (EOEs) to claim refunds for value-added tax (VAT) paid while awaiting zero-rating certification from the Department of Trade and Industry under transition rules that ran until the end of 2025. Under Revenue Memorandum Circular No. 096-2026, the BIR said EOEs may seek refunds for VAT paid on local purchases and importations from Nov. 28, 2024, the effectivity of the CREATE MORE Act, until the issuance of their VAT zero-rating certifications. READ: PCCI cheers move to relax VAT refund requirements Also, the DTI-Export Marketing Bureau (DTI-EMB) will allow the refund if it issues the certification during the transitory period, which runs from Nov. 28, 2024, to Dec. 31, 2025. Meanwhile, the BIR had already issued a circular in April 2025 defining eased procedures and requirements for VAT refund claims. But the latest issuance clarifies the refund period amid differences in the dates when EOEs received their zero-rating certifications, which left some qualified enterprises continuing to pay VAT after the CREATE MORE Act took effect. “Export-oriented enterprises received their VAT zero-rating certifications on different dates during the transition period.We are clarifying how qualified export-oriented enterprises should treat the VAT incurred during the processing of these certifications, ensuring they have a clear basis for their refund claims.” BIR Commissioner Charlito Martin R. Mendoza said. “Our objective is to ensure fair and consistent tax treatment for qualified export-oriented enterprises during the transition to the new zero-rating certification system,” he added. Likewise, the circular clarified EOEs that met the 70-percent export threshold last year but lacked the DTI-EMB certification will lose their VAT refund entitlement for the following year. Additionally, they may instead carry forward unused input VAT to following taxable quarters and use it against future VAT liabilities, subject to existing tax rules. Meanwhile, the BIR also said that taxpayers cannot receive a VAT refund if they have already refunded, credited, adjusted, recovered it from suppliers, or otherwise used it. Effective April 1, 2025, businesses may file VAT refund claims covering pre-CREATE MORE periods without DTI-EMB certification. /pai