Tax appeals court upholds refund of P56.8 million to Pilipinas Shell

Court of Tax Appeals (CTA)

THE Court of Tax Appeals (CTA) upheld its ruling granting P56.8-million excise tax refund to Pilipinas Shell Petroleum Corp.

In a resolution dated Dec. 21, the court, sitting en banc, denied for lack of merit the motion for reconsideration of the Bureau of Internal Revenue (BIR) over the tax refund granted to Pilipinas Shell.

The BIR claimed that the court erred in ruling that the company is entitled to the refund representing excise taxes it paid on Jet A-1 fuel sold to tax-exempt international carriers.

The court said the arguments raised were “mere restatements” of those in the previous pleadings.

“Petitioner utterly failed to raise any new or substantial matter let alone any compelling reason to warrant the modification much less reversal of the Court En Banc’s findings.,” the court said.


“The Court En Banc stands by its ruling that respondent is entitled to the refund of duly substantiated excise taxes paid on petroleum products sold to international carriers from August 12, 2013 to December 31, 2013,” it added.

The court said that Pilipinas Shell in its comment maintained that excise tax on petroleum products is a tax on property and the exemption is granted under Section 135 of the Tax Code.

The court in June 2020 denied the petition for review of the BIR and upheld the 2018 decision and resolution of its special third division that partially granted the tax refund claim of Pilipinas Shell, ordering the BIR to refund the amount of P56.8 million out of its P61.5-million claim.

Only the amount granted was properly substantiated by relevant documents, the court said.

The CTA in its previous decision cited Sections 135(a) of the Tax Code, which states that petroleum products sold to international carriers of Philippine or foreign registry on their use or consumption outside the country are exempt from excise tax. — Vann Marlo M. Villegas


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