Statement 1: The government or any of its political subdivisions, instrumentalities, or agencies, including government-owned or controlled corporations shall, before making a payment on account of each purchase of goods or services subject to VAT, deduct and withhold a final VAT due at the rate of five percent (5%) of the gross payment thereof. Statement 2: The five percent (5%) final VAT withholding rate shall represent the net VAT payable of the seller. Which statement is correct? in philippines tax