CTA partially grants P70.77-M tax credit to Pilipinas Shell

THE Court of Tax Appeals (CTA) has granted Pilipinas Shell Petroleum Corp. a P70.77-million tax refund or credit certificate for excess excise taxes paid in 2019, partially approving the company’s request.

In a Sept. 23 decision, the tax court’s third division ruled that the company is entitled to a tax return of just over P70 million out of the P71 million it petitioned for, disallowing P414,864 because the company sold fuel to an airline without a valid foreign air carrier’s permit (FACP).

“[The] petitioner sufficiently proved that the excise taxes it paid for the imported Jet A-1 fuel and subsequently sold to tax-exempt international air carriers were erroneous and thus, refundable… but only in the reduced amount of P70,767,488.00,” a part of the 34-page ruling of Associate Justice Catherine T. Manahan read.

“Only the sale of imported Jet A-1 fuel to… airlines with valid FACP may qualify for the refund or issuance of a tax credit certificate of the erroneously paid excise taxes,” it added.

The CTA disallowed around 103,000 liters of imported jet fuel from the 17.7 million liters petitioned after finding that Pilipinas Shell Petroleum Corp. sold it to a European airline without a valid FACP. — Kenneth Christiane L. Basilio