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Tax Review Question
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Question: Matsushita Panasonic Philippines is a domestic corporation engaged in the manufacture and assembly of appliances. Kyushu Philippines is also a domestic corporation incorporated by the same principals of Matsushita Panasonic. Because or losses, Kyushu has to suspend operations. Matsushita Panasonic, being the parent company, is proposing to buy all the products of Kyushu. Should Kyushu be allowed 12% VAT on the proposed sale?Yes, since it is a transaction deemed saleNo, the parent company legally owns the assets of the subsidiary corporationNo, however, a capital gains tax will be charged at 6% on the market value of the machineriesYes, since it is a sale in the ordinary course of business