Practice question
A VAT-registered retailer permanently ceases business while retaining taxable inventory. Its owner insists that no VAT consequence can arise until a later purchaser pays for each item, because no customer sale occurred on closure. Which answer follows Section 106(B)?
- Closure universally exempts all remaining goods
- Only a shareholder’s personal preference matters
- No inventory can be considered at cessation
- Cessation with inventories of taxable goods is itself an expressly listed deemed-sale event
- Every closure is necessarily a zero-rated export
Legal references
- NIRC Section 106(B): https://lawphil.net/statutes/repacts/ra1997/ra_8424_1997.html
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