VAT exempt (Sec 116 and 127 of the

NIR code)
1. Sale or importation of agricultural
and marine products. Considered in
their original state even undergone
the simple process of preservation for
the market.
2. Sale and importation of fertilizers,
feeds and ingredients, whether locally
produced or imported.
3. Personal and household effects
belonging to residents of the
Philippines returning from abroad or
non-resident citizens planning to settle
in the Philippines. Provided: Such
goods exempt from Tariff and Custom
Code of the Philippines.
4. Importation of:
a. Professional instruments and
implements
b. Wearing apparels
c. Domestic animals
d. Personal household effects
Except:
a.
b.
c.
d.

Vehicle
Vessel
Aircrafts
Goods used for manufacture
and merchandise of any kind
of commercial quantity

Requirements:
a. Belonging to persons coming to
settle in the Philippines
b. Importation accompany the
owner or arrives before or after
the arrival of the owner
c. Production of evidence
satisfactory to the
commissioner
d. Change of evidence is bona fide
(made or done in an honest and
sincere way)
5. Subject to percentage tax
6. Services for other contract growers
7. Medical, dental, hospital and
veterinary services (except those
rendered by professional)

8. Educational services rendered by

government and private educational
institution approved by:
a. DepEd
b. CHED
c. TESDA
9. Services rendered under employeremployee relationship
10. Services rendered by RAQ
multinational corp. act as a
supervisory, communication and
coordination center of their affiliates.
Do not earn income
11. Exempt under international
agreement to which the Philippines is
the signatory or under special laws.
Except those under Presidential
Decree 529 (Granting to Petroleum
exploration concessionaires under the
petroleum act of 1949 exemption from
custom duty and compensating tax on
importations of machinery and
equipment, spare parts and materials
required for their exploration
operations.)
12. Sale of agricultural cooperatives
registered with Cooperative
Development Authority
13. Gross receipts of lending activities
by credit and multi-purpose
cooperative registered with the CDA
limited to their members
14. Sale of non-agricultural, nonelectric and non-credit co-operatives
duly registered with CDA
Provided: Each members
contribution does not exceed P15,000
regardless of the aggregate capital
and net surplus ratably distributed to
their members.
15. Export sales of persons who are
not VAT-registered
16. Sale of residential lot not
exceeding 1,919,500. Sale of house
and lot not exceeding 3,199,200.
17. Lease of residential unit not
exceeding 12,800
18. Sale importation, printing or
publication of books and any

newspaper, magazine, review or

bulletin which appears at regular
intervals with fixed prices for
subscriptions. Not devoted primarily
for the publication of advertisements

19. Sale, importation or lease of

passenger or cargo vessels and
aircraft, including engine equipment
and spare parts thereof for domestic
or international transport operations.
20. Importation of fuel, goods and
supplies by persons engaged in
international shipping, or air transport
operations.
21. Services of banks, non-bank
financial intermediaries performing
quasi-judicial functions, and other nonbank financial intermediaries.
22. Gross receipts not exceeding
1,919,500
EXPORT SALES
1. Sale Of raw materials or packaging
materials to a non-resident buyer for a
delivery to a resident local exportoriented enterprise to be used in

manufacturing , processing, packing or

repacking in the Philippines of the said
buyers goods and paid in acceptable
foreign currency and accounted for in
accordance with the rules and
regulations of Banki Sentral Ng
Pilipinas.
2. Sale of raw materials or packaging
materials to a export-oriented
enterprise whose export sales
exceed 70% of total annual
production.
3. Sale of gold to BSP
4. Considered export sale under EO
No. 226, otherwise known as Omnibus
Investment Code of 1987, and under
special laws
5. Sale of goods, supplies, equipment
to persons engaged in international
shipping or international air transport
operations.
Foreign currency denominated
sale meaning #1 in export sales