Practice question
At cessation, a VAT-registered trader still holds taxable inventory. It says there can be no deemed sale because it neither received cash nor physically handed the goods to a buyer. What is the best statutory analysis?
- No deemed-sale provision can ever apply without an ordinary sale.
- The cessation-inventory category is expressly a deemed sale and does not require the asserted ordinary-sale facts.
- Every cessation automatically grants a refund equal to inventory value.
- The inventory becomes tax-exempt merely because the business stopped.
- The retailer may cancel all records and erase the transaction by label.
Legal references
- NIRC Sections57-58,105-106 and110: https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html
- RA11976, Sections9-10, current NIRC58(E) credit/refund conditions and trust-fund rule: https://lawphil.net/statutes/repacts/ra2024/ra_11976_2024.html
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