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 sale
No, the parent company legally owns the assets of the subsidiary corporation
No, however, a capital gains tax will be charged at 6% on the market value of the machineries
Yes, since it is a sale in the ordinary course of business