The Court of Tax Appeals (CTA) has affirmed the grant of a tax credit to the Kuwait Airways Corp. for P11.97 million representing its overpaid income tax for the year ending March 2016.
In a 24-page decision written by Associate Justice Lanee Cui-David, the tax court en banc affirmed the May 2021 decision of the CTA’s Second Division on the case.
The CTA en banc said no new or substantial arguments were made by the parties to persuade the tribunal to reverse the findings of the second division.
In its May 2021 decision, the tax court’s Second Division partially granted the firm’s petition and ordered the issuance of the tax credit certificate (TCC).
The amount represents overpaid income taxes on its Gross Philippine Billings (GPBs) for the year 2016.
GPB refers to the amount of gross revenue derived from the carriage of persons, excess baggage, cargo, and mail originating from the Philippines in a continuous and uninterrupted flight, irrespective of the place of sale or issue and the place of payment of the ticket or passage document.
Any international carrier doing business in the Philippines pays a tax of 2.5 percent of its GPBs.
A tax credit may be used as payment or converted as a cash refund.
The CTA said the petitioner filed its administrative and judicial claims on time and there was an erroneous overpayment of income tax.
Kuwait Airways also has flights to Dubai and Abu Dhabi in the United Arab Emirates, Saudi Arabia, Doha in Qatar, London, Istanbul in Turkey, and Beirut, Lebanon