RMC No. 24-2023

RMC No. 24-2023 (issued February 17, 2023) further clarifies when an Ecozone Logistics Service Enterprise (ELSE) qualifies for VAT zero-rate on local purchases of goods and services exclusively and directly used in its registered project or activity. An ELSE is a Registered Business Enterprise catering exclusively to export manufacturing enterprises registered with PEZA, CDC, SBMA, AFAB or other special economic zones/freeports; ELSEs rendering at least 70% of their output/services to another RBE are covered by the 'export enterprise' definition under Section 293(E) of the NIRC as amended by the CREATE Act, as clarified in BOI MC No. 2023-001. Only logistics services with BOTH a warehouse storage facility and importation/procurement of goods for resale or export-related packing/processing qualify as ELSE; trucking and forwarding services are excluded from the RBE definition. Applications for VAT zero-rating are processed under RMO No. 7-2006, must strictly comply with Sections 294(E) and 295(D) of the NIRC and CREATE IRR rules, and require attachments including an IPA-issued Certificate of Registration and VAT Certification, a sworn affidavit from the export enterprise-buyer, and corroborating transaction documents.