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(Emphasis supplied) The above provision is clear -- even a non-stock, non-profit organization or government
entity is liable to pay VAT on the sale of goods or services. This conclusion was affirmed by the
Supreme Court in Commissioner of Internal Revenue v. Court of Appeals and Commonwealth
Management and Services Corporation, G.R. No. 125355, March 30, 2000. In this case, the
Supreme Court held:
“(E)ven a non-stock, non-profit organization or government entity, is liable to
pay VAT on the sale of goods or services. VAT is a tax on transactions, imposed at every
stage of the distribution process on the sale, barter, exchange of goods or property, and on
the performance of services, even in the absence of profit attributable thereto. The term
"in the course of trade or business" requires the regular conduct or pursuit of a
commercial or an economic activity, regardless of whether or not the entity is profitoriented. The definition of the term "in the course of trade or business" incorporated in the
present law applies to all transactions even to those ma...
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This document was uploaded on 02/09/2014.
- Spring '14