Bill exempting donated goods from VAT filed

MANILA, Philippines - Sen. Loren Legarda has filed a bill exempting all relief goods donated by foreign groups from valued added tax (VAT).

“Donated items or goods from foreign donors which are exclusively for non-profit, charitable, humanitarian, relief purposes benefiting the poor and the needy, should be exempt from payment of the value added tax,” Legarda said.

Senate Bill 1411 proposes that imported goods exclusively intended for non-profit, charitable, humanitarian and relief purposes would be exempted from the 12 percent VAT.

The bill also provides that donations of food, medicine and equipment for government relief and rehabilitation programs exempted from import duties also be exempted from VAT. Section 107 of the National Internal Revenue Code stipulates that all importations should be subject to VAT.

“If such goods are exempt from VAT, it will facilitate the entry and the distribution of donations for the benefit of the less fortunate,” Legarda said.