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50824347-tax-2

50824347-tax-2

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Published by: Ana Janine Ambata on Jun 28, 2012
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06/28/2012

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TITLE VI
 
EXCISE TAX ON CERTAIN GOODS
 
CHAPTER I - GENERAL PROVISIONS
 
SEC.129. Goods subject to Excise Taxes.
-Excise taxes apply to goods manufactured or produced in the Philippines for domestic sales or consumption or for any other disposition and tothings imported. The excise tax imposed hereinshall be in addition to the value-added taximposed under Title IV.For purposes of this Title, excise taxes hereinimposed and based on weight or volumecapacity or any other physical unit of measurement shall be referred to as 'specifictax' and an excise tax herein imposed andbased on selling price or other specified value of the good shall be referred to as 'ad valorem tax.'
SEC. 130. Filing of Return and Payment of Excise Tax on Domestic Products. -
 (A) Persons Liable to File a Return, Filing of Return on Removal and Payment of Tax. -
(1) Persons Liable to File a Return.
-Every person liable to pay excise taximposed under this Title shall file aseparate return for each place of production setting forth, among othersthe description and quantity or volumeof products to be removed, theapplicable tax base and the amount of tax due thereon: Provided, however,That in the case of indigenouspetroleum, natural gas or liquefiednatural gas, the excise tax shall be paidby the first buyer, purchaser or transferee for local sale, barter or transfer, while the excise tax onexported products shall be paid by theowner, lessee, concessionaire or operator of the mining claim.Should domestic products be removedfrom the place of production without thepayment of the tax, the owner or personhaving possession thereof shall be liablefor the tax due thereon.
(2) Time for Filing of Return andPayment of the Tax.
- Unless otherwisespecifically allowed, the return shall befiled and the excise tax paid by themanufacturer or producer beforeremoval of domestic products formplace of production: Provided, That thetax excise on locally manufacturedpetroleum products and indigenouspetroleum/levied under Sections 148and 151(A)(4), respectively, of this Titleshall be paid within ten (10) days fromthe date of removal of such products for the period from January 1, 1998 to June30, 1998; within five (5) days from thedate of removal of such products for theperiod from July 1, 1998 to December 31, 1998; and, before removal from theplace of production of such productsfrom January 1, 1999 and thereafter:Provided, further, That the excise tax onnonmetallic mineral or mineral products,or quarry resources shall be due andpayable upon removal of such productsfrom the locality where mined or extracted, but with respect to the excisetax on locally produced or extractedmetallic mineral or mineral products, theperson liable shall file a return and paythe tax within fifteen (15) days after theend of the calendar quarter when suchproducts were removed subject to suchconditions as may be prescribed byrules and regulations to be promulgatedby the Secretary of Finance, uponrecommendation of the Commissioner.For this purpose, the taxpayer shall filea bond in an amount whichapproximates the amount of excise taxdue on the removals for the saidquarter. The foregoing rulesnotwithstanding, for imported mineral or mineral products, whether metallic or nonmetallic, the excise tax due thereonshall be paid before their removal fromcustoms custody.
(3) Place of Filing of Return andPayment of the Tax.
- Except as theCommissioner otherwise permits, thereturn shall be filed with and the tax paidto any authorized agent bank or Revenue Collection Officer, or dulyauthorized City or Municipal Treasurer in the Philippines.
(4) Exceptions.
- The Secretary of Finance, upon recommendation of theCommissioner may, by rules andregulations, prescribe:(a) The time for filing the returnat intervals other than the timeprescribed in the precedingparagraphs for a particular classor classes of taxpayers after considering factors such asvolume of removals, adequatemeasures of security and suchother relevant informationrequired to be submitted under the pertinent provisions of thisCode; and(b) The manner and time of payment of excise taxes other than as herein prescribed, under a tax prepayment, advancedeposit or similar schemes. Inthe case of locally produced of extracted minerals and mineralproducts or quarry resourceswhere the mine site or place of extraction is not the same as theplace of processing or production, the return shall befiled with and the tax paid to theRevenue District Office having jurisdiction over the localitywhere the same are mined,extracted or quarried: Provided,however, That for metallicminerals processed abroad, thereturn shall be filed and the taxdue thereon paid to theRevenue District Office having jurisdiction over the localitywhere the same are mined,extracted or quarried.
(B) Determination of Gross Selling Price of Goods Subject to Ad Valorem Tax.
- Unlessotherwise provided, the price, excluding thevalue-added tax, at which the goods are sold atwholesale in the place of production or throughtheir sales agents to the public shall constitutethe gross selling price. If the manufacturer alsosells or allows such goods to be sold atwholesale in another establishment of which he
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is the owner or in the profits of which he has aninterest, the wholesale price in suchestablishment shall constitute the gross sellingprice. Should such price be less than the cost of manufacture plus expenses incurred until thegoods are finally sold, then a proportionatemargin of profit, not less than ten percent (10%)of such manufacturing cost and expenses, shallbe added to constitute the gross selling price.
(C) Manufacturer's or Producer's SwornStatement.
- Every manufacturer or producer of goods or products subject to excise taxes shallfile with the Commissioner on the date or datesdesignated by the latter, and as often as may berequired, a sworn statement showing, amongother information, the different goods or products manufactured or produced and their corresponding gross selling price or marketvalue, together with the cost of manufacture or production plus expenses incurred or to beincurred until the goods or products are finallysold.
(D) Credit for Excise tax on Goods ActuallyExported.
- When goods locally produced or manufactured are removed and actuallyexported without returning to the Philippines,whether so exported in their original state or asingredients or parts of any manufactured goodsor products, any excise tax paid thereon shall becredited or refunded upon submission of theproof of actual exportation and upon receipt of the corresponding foreign exchange payment:Provided, That the excise tax on mineralproducts, except coal and coke, imposed under Section 151 shall not be creditable or refundableeven if the mineral products are actuallyexported.
SEC. 131. Payment of Excise Taxes onImporter Articles. -
 
(A) Persons Liable.
- Excise taxes onimported articles shall be paid by theowner or importer to the CustomsOfficers, conformably with theregulations of the Department of Finance and before the release of sucharticles from the customshouse, or bythe person who is found in possessionof articles which are exempt from excisetaxes other than those legally entitled toexemption.In the case of tax-free articles brought or imported into the Philippines bypersons, entitles, or agencies exemptfrom tax which are subsequently sold,transferred or exchanged in thePhilippines to non-exempt persons or entitles, the purchasers or recipientsshall be considered the importersthereof, and shall be liable for the dutyand internal revenue tax due on suchimportation.The provision of any special or generallaw to the contrary notwithstanding, theimportation of cigars and cigarettes,distilled spirits and wines into thePhilippines, even if destined for tax andduty free shops, shall be subject to allapplicable taxes, duties, charges,including excise taxes due thereon:Provided, however, That this shall notapply to cigars and cigarettes, distilledspirits and wines brought directly intothe duly chartered or legislated freeportsof the Subic Special Economic andFreeport Zone, crated under Republic Act No. 7227; the Cagayan SpecialEconomic Zone and Freeport, createdunder Republic Act No. 7922; and theZamboanga City Special EconomicZone, created under Republic Act No.7903, and are not transshipped to anyother port in the Philippines: Provided,further, That importations of cigars andcigarettes, distilled spirits and wines bya government-owned and operatedduty-free shop, like the Duty-FreePhilippines (DFP), shall be exemptedfrom all applicable taxes, duties,charges, including excise tax duethereon: Provided, still further, That if such articles directly imported by agovernment-owned and operated duty-free shop like the Duty-Free Philippines,shall be labelled 'tax and duty-free' and'not for resale': Provided, still further,That is such articles brought into theduly chartered or legislated freeportsunder Republic Acts No. 7227, 7922and 7903 are subsequently introducedinto the Philippine customs territory,then such articles shall, upon suchintroduction, be deemed imported intothe Philippines and shall be subject toall imposts and excise taxes providedherein and other statutes: Provided,finally, That the removal and transfer of tax and duty-free goods, products,machinery, equipment and other similar articles, from one freeport to another freeport, shall not be deemed anintroduction into the Philippine customsterritory. Articles consfiscated shall be disposedof in accordance with the rules andregulations to be promulgated by theSecretary of Finance, uponrecommendation of the Commissioner of Customs and Internal Revenue, uponconsultation with the Secretary of Tourism and the General manager of the Philippine Tourism Authority.The tax due on any such goods,products, machinery, equipment or other similar articles shall constitute a lien onthe article itself, and such lien shall besuperior to all other charges or liens,irrespective of the possessor thereof.
(B) Rate and Basis of the Excise Tax onImported Articles.
- Unless otherwise specifiedimported articles shall be subject to the samerates and basis of excise taxes applicable tolocally manufactured articles.
SEC. 132. Mode of Computing Contents of Cask or Package.
- Every fractional part of aproof liter equal to or greater than a half liter in acask or package containing more than one liter shall be taxed as a liter, and any smaller fractional part shall be exempt; but any packageof spirits, the total content of which are less thana proof liter, shall be taxed as one liter.
TITLE VI
 
EXCISE TAX ON CERTAIN GOODS
 
CHAPTER II - EXEMPTION OR CONDITIONALTAX-FREE REMOVAL OF CERTAINARTICLES
 
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SEC. 133. Removal of Wines and distilledSpirits for Treatment of Tobacco Leaf.
- Uponissuance of a permit from the Commissioner andsubject to the rules and regulations prescribedby the Secretary of Finance, manufacturers of cigars and cigarettes may withdraw from bond,free of excise local and imported wines anddistilled spirits in specific quantities and gradesfor use in the treatment of tobacco leaf to b usedin the manufacture of cigars and cigarettes; butsuch wines and distilled spirits must first besuitably denatured.
SEC. 134. Domestic Denatured Alcohol.
-Domestic alcohol of not less than one hundredeighty degrees (180
O
) proof (ninety percent(90%) absolute alcohol) shall, when suitablydenatured and rendered unfit for oral intake, beexempt from the excise tax prescribed in Section141: Provided, however, That such denaturedalcohol shall be subject to tax under Section106(A) of this Code: Provided, further, That if such alcohol is to be used for motive power, itshall be taxed under Section 148(d) of thisCode: Provided, finally, That any alcohol,previously rendered unfit for oral intake after denaturing but subsequently rendered fit or oralintake after undergoing fermentation, dilution,purification, mixture or any other similar processshall be taxed under Section 141 of this Codeand such tax shall be paid by the person inpossession of such reprocessed spirits.
SEC. 135. Petroleum Products Sold toInternational Carriers and Exempt Entities or Agencies. -
Petroleum products sold to thefollowing are exempt from excise tax:(a) International carriers of Philippine or foreign registry on their use or consumption outside the Philippines:Provided, That the petroleum productssold to these international carriers shallbe stored in a bonded storage tank andmay be disposed of only in accordancewith the rules and regulations to beprescribed by the Secretary of Finance,upon recommendation of theCommissioner;(b) Exempt entities or agencies coveredby tax treaties, conventions and other international agreements for their use of consumption: Provided, however, Thatthe country of said foreign internationalcarrier or exempt entities or agenciesexempts from similar taxes petroleumproducts sold to Philippine carriers,entities or agencies; and(c) Entities which are by law exemptfrom direct and indirect taxes.
SEC. 136. Denaturation, Withdrawal and Useof Denatured Alcohol
. - Any person whoproduces, withdraws, sells, transports or knowingly uses, or is in possession of denaturedalcohol, or articles containing denatured alcoholin violation of laws or regulations now or hereafter in force pertaining thereto shall berequired to pay the corresponding tax, inaddition to the penalties provided for under TitleX of this Code.
SEC. 137. Removal of Spirits Under Bond for Rectification
.- Spirits requiring rectification maybe removed from the place of production toanother establishment for the purpose of rectification without prepayment of the excisetax: Provided, That the distiller removing suchspirits and the rectifier receiving them shall filewith the Commissioner their joint bondconditioned upon the payment by the rectifier of the excise tax due on the rectified alcohol:Provided, further, That in cases where alcoholhas already been rectified either by original andcontinuous distillation or by redistillation, no lossfor rectification and handling shall be allowedand the rectifier thereof shall pay the excise taxdue on such losses: Provided, finally, Thatwhere a rectifier makes use of spirits upon whichthe excise tax has not been paid, he shall beliable for the payment of the tax otherwise duethereon.
SEC. 138. Removal of Fermented Liquors toBonded Warehouse
. - Any brewer may removeor transport from his brewery or other place of manufacture to a bonded warehouse used byhim exclusively for the storage or sale in bulk of fermented liquors of his own manufacture, anyquantity of such fermented liquors, not less thanone thousand (1,000) liters at one removal,without prepayment of the tax thereon under apermit which shall be granted by theCommissioner. Such permit shall be affixed toevery package so removed and shall becancelled or destroyed in such manner as theCommissioner may prescribe. Thereafter, themanufacturer of such fermented liquors shallpay the tax in the same manner and under thesame penalty and liability as when paid at thebrewery.
SEC. 139. Removal of Damaged Liquors Freeof Tax.
- When any fermented liquor hasbecome sour or otherwise damaged so as to beunfit for use as such, brewers may sell and after securing a special permit from theCommissioner, under such conditions as may beprescribed in the rules and regulationsprescribed by the Secretary of Finance, removethe same without the payment of tax thereon incask or other packages, distinct from thoseordinarily used for fermented liquors, eachcontaining not less than one hundred seventy-five (175) liters with a note of their contentspermanently affixed thereon.
SEC. 140. Removal of Tobacco Productswithout Prepayment of Tax.
- Products of tobacco entirely unfit for chewing or smokingmay be removed free of tax for agricultural or industrial use, under such conditions as may beprescribed in the rules and regulationsprescribed by the Secretary of Finance.Stemmed leaf tobacco, fine-cut shorts, therefuse of fine-cut chewing tobacco, scraps,cuttings, clippings, stems, or midribs, andsweepings of tobacco may be sold in bulk asraw material by one manufacturer directly toanother without payment of the tax, under suchconditions as may be prescribed in the rules andregulations prescribed by the Secretary of Finance.
'Stemmed leaf tobacco
,' as herein used,means leaf tobacco which has had the stem or midrib removed. The term does not includebroken leaf tobacco.
TITLE VI
 
EXCISE TAX ON CERTAIN GOODS
 
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