Sale of residential house and lot by an official of a domestic corporation to another official in the same corporation for a consideration of P2.5…

The question

Sale of residential house and lot by an official of a domestic corporation to another official in the same corporation for a consideration of P2.5 Million in 2011 is: (2012 Bar Question)

1. A.Exempt from VAT because the gross sales do not exceed P2.5 Million;
2. B.Exempt from VAT because the property sold is a capital asset, regardless of the gross selling price;
3. C.Exempt from VAT because the seller is not a person engaged in real estate business;
4. D.Taxable at 12% VAT output tax on the gross selling price of P2.5 Million.

This question has not been answered yet.