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G.R. No. 125355. March 30, 2000.
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PARDO, J.:
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the Court of Tax Appeals, which affirmed with
modification the decision of the Commissioner of Internal
Revenue ruling that Commonwealth Management and
Services Corporation, is liable for value added tax for
services to clients during taxable year 1988.
Commonwealth Management and Services Corporation
(COMASERCO, for brevity), is a corporation duly
organized and existing under the laws of the Philippines. It
is an affiliate of Philippine American Life Insurance Co.
(Philamlife), organized by the latter to perform collection,
consultative and other technical services, including
functioning as an internal auditor, of Philamlife and its
other affiliates.
On January 24, 1992, the Bureau of Internal Revenue
(BIR) issued an assessment to private respondent
COMASERCO for deficiency value-added tax (VAT)
amounting to P351,851.01, for taxable year 1988, computed
as follows:
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cannot be merely implied therefrom. In the case of VAT,
Section 109, Republic Act 8424 clearly enumerates the
transactions exempted from VAT. The services rendered by
COMASERCO do not fall within the exemptions.
Both the Commissioner of Internal Revenue and the
Court of Tax Appeals correctly ruled that the services
rendered by COMASERCO to Philamlife and its affiliates
are subject to VAT. As pointed out by the Commissioner,
the performance of all kinds of services for others for a fee,
remuneration or consideration is considered as sale of
services subject to VAT. As the government agency charged
with the enforcement of the law, the opinion of the
Commissioner of Internal Revenue, in the absence of any
showing14 that it is plainly wrong, is entitled to great
weight. Also, it has been the long standing policy and
practice of this Court to respect the conclusions of
quasijudicial agencies, such as the Court of Tax Appeals
which, by the nature of its functions, is dedicated
exclusively to the study and consideration of tax cases and
has necessarily developed an expertise on the subject,
unless there 15has been an abuse or improvident exercise of
its authority.
There is no merit to respondent’s contention that the
Court of Appeals’ decision in CA-G.R. No. 34042, declaring
the COMASERCO as not engaged in business and not
liable for the payment of fixed and percentage taxes, binds
petitioner. The issue in CA-G-R. No. 34042 is different from
the present case, which involves COMASERCO’s liability
for VAT. As heretofore stated, every person who sells,
barters, or exchanges goods and services, in the course of
trade or business, as defined by law, is subject to VAT.
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