Different Delivery Address is Not Fictitious: CV DS Wins Export VAT Dispute Against DGT

CV DS Tax Dispute: Substance Over Form in Export Input VAT Crediting

The dispute over the crediting of Input VAT amounting to IDR 2,760,924,649 at CV DS has become a major highlight regarding the application of the substance over form principle in exports. The tax authorities made corrections on the grounds of discrepancies in delivery addresses and the use of third-party facilities, which were deemed to have formally broken the chain of goods delivery under VAT regulations.

The Conflict: Technical Operational Constraints vs. Formal Registration

The conflict began when the Respondent rejected Input VAT credits because CV DS's ordered goods were sent to a warehouse in Mojoagung and the Meratus Depot, rather than the registered office address in Surabaya. The Respondent argued that CV DS was merely an export deposit service intermediary due to their lack of their own warehouse and very slim profit margins. Conversely, CV DS asserted that materially, they were the owners of the goods who purchased from suppliers, funded the transactions, and performed exports in their own name, while the difference in delivery locations was purely due to technical operational constraints.

Judicial Rationale: Seeking Material Truth in VAT Disputes

The Board of Judges, in its legal rationale, emphasized that VAT disputes must be resolved by seeking material truth in accordance with Article 9 paragraph (8) of the VAT Law. The Judges assessed that CV DS had proven the existence of the transactions through synchronized document flow (PO, Invoice) and money flow (Bank Statements). The use of an affiliate's address for the container stuffing process was considered a common business fact and did not invalidate the right to credit Input VAT as long as the goods were genuinely used for taxable delivery activities (exports).

Juridical Implications: Legal Certainty for Traders

Juridically, this decision confirms that administrative failure regarding the reporting of business premises does not automatically eliminate the Taxpayer's substantive right to credit Input VAT if evidence of physical and legal control of the goods for export purposes is met. This provides legal certainty that the status as a trader cannot be dismissed solely based on the size of profit margins or the absence of a physical warehouse at the office location.

In conclusion, Input VAT crediting remains valid as long as the Taxpayer can prove the validity of the transaction through comprehensive supporting evidence. Taxpayers are advised to ensure synchronization between purchase documents, delivery documents, and export documents to mitigate the risk of similar corrections in the future.