The Court of Tax Appeals (CTA) has denied the petition filed by a local food and beverage manufacturer seeking a refund of more than PHP1.26 billion in alleged erroneously paid sweetened beverage taxes (SBT) on its chocolate malt products.In its 23-page decision written by Associate Justice Ma. Belen M. Ringpis-Liban dated Oct. 6 and published online Wednesday, the tax court “denied for lack of merit” the petition filed by Nestle Philippines seeking a refund of PHP1,266,599,459.91 in taxes for its Milo brand products.The amount represents taxes paid from May to December 2018, after Republic Act 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) Act took effect, which includes a provision imposing SBT for the first time.Nestle said its Milo brand products should not be considered as a “sweetened beverage” and because it contains milk as an essential ingredient, it should instead be covered by the provision that excludes “all milk products” from SBT.The court, however, ruled that under the rules
, “while it can be said that flavored fluid milk includes all types of mixes, whether powder or syrup, it specifically did not include cocoa-sugar mix” and that Milo products “cannot be categorized as fluid flavored milk drinks as the same can also be categorized as cocoa-sugar mix.””Tax refunds partake of the nature of tax exemptions and therefore cannot be allowed unless granted in the most explicit and categorical language. The grant of refund privileges must be strictly construed against the taxpayer and liberally in favor of the government,” the court said.
Source: Philippines News Agency