TAXATION II

Atty. Susan Aquino

5 April 2018
TOPIC CLASS NOTES
DOCUMENTARY STAMP TAX
Definition
 DST is a tax on documents, instruments, and papers evidencing the acceptance, assignment, sale or
transfer of an obligation, rights or property incident thereto (Sec 173)
Nature
 Excise tax or Privilege tax – it is really imposed on the privilege to enter into a transaction rather than on
document. Document is only taxed because of the transaction
 Revenue generation – purpose of law in imposing stamp taxes is to raise revenue.
 Note: both person issuing and the one whom the document is issued may be made liable to tax.
o The tax imposed against the person making, signing, issuing, accepting or transferring the document
or facility evidencing the transaction.
o If party assuming payment is tax exempt, the other party in the document who is not exempt becomes
liable.
Transaction/Documents Subject to DST
 Loan Agreements, Instruments and Papers
o Section 173.
- Upon documents, instruments, loan agreements and papers, and upon acceptances,
assignments, sales and transfers of the obligation, right or property incident thereto,
- there shall be levied, collected and paid for, and in respect of the transaction so had or
accomplished,
- the corresponding documentary stamp taxes prescribed in the following Sections of this Title,
- by the person making, signing, issuing, accepting, or transferring the same wherever the
document is made, signed, issued, accepted or transferred
- when the obligation or right arises from Philippine sources or the property is situated in the
Philippines, and the same time such act is done or transaction had: Provided, That whenever one
party to the taxable document enjoys exemption from the tax herein imposed, the other party
who is not exempt shall be the one directly liable for the tax.
 Original Issuance of Shares
o Section 174.
- On all debentures and certificates of indebtedness
- issued by any association, company or corporation,
- there shall be collected a documentary stamp tax of P2.00 on each Two hundred pesos (P200),
or fractional part thereof, of the face value of such documents.
 Transfer of Shares
o Section 175
- On every original issue, whether on organization, reorganization or for any lawful purpose, of shares
of stock by any association, company or corporation,
- there shall be collected a documentary stamp tax of P1.50 on each P200, or fractional part
thereof, of the par value, of such shares of stock:
- Provided, That in the case of the original issue of shares of stock without par value the amount of
the documentary stamp tax herein prescribed shall be based upon the actual consideration for
the issuance of such shares of stock:
- Provided, further, That in the case of stock dividends, on the actual value represented by each
share.
 Foreign Issued Bonds, Debentures, shares or Certificates of indebtedness and other instruments
o Section 176
- On all sales, or agreements to sell, or memoranda of sale, or deliveries, or transfer of due-bills,
certificates of obligation, or shares of certificates of stock
- in any association, company, or corporation, or transfer of such securities by assignment in blank,
or by delivery, or by any paper or agreement, or memorandum or other evidences of transfer or
sale
TAXATION II
Atty. Susan Aquino
5 April 2018
- whether entitling the holder in any manner to the benefit of such due-bills, certificates of obligation
or stock, or to secure the future payment of money, or for the future transfer of any due-bill,
certificate of obligation or stock,
- there shall be collected a documentary stamp tax of P1.50 on each P200 or fractional part thereof,
of the par value of such due-bill, certificate of obligation or stock;
- Provided, That only one tax shall be collected on each sale or transfer of stock or securities from
one person to another, regardless of whether or not a certificate of stock or obligation is issued,
indorsed, or delivered in pursuance of such sale or transfer: and,
- Provided, further, That in the case of stock without par value the amount of documentary stamp
tax herein prescribed shall be equivalent to 25% of the documentary stamp tax paid upon the
original issue of said stock.
 Certificate of profits or interest in property or accumulations
o Section 177
- On all certificates of profits, or any certificate or memorandum showing interest in the property or
accumulations of any association, company or corporation, and on all transfers of such
certificates or memoranda,
- there shall be collected a documentary stamp tax of P1.00 on each P200, or fractional part
thereof, of the face value of such certificates or memorandum.
 Banks, Checks, Drafts, Certificates of Deposit not Bearing Interest
o Section 178
- On each bank check, draft, or certificate of deposit not drawing interest, or order for the payment
of any sum of money drawn upon or issued by any bank, trust company, or any person or persons,
companies or corporations, at sight or on demand, there shall be collected a documentary stamp
tax of P3.00
 Debt Instruments
o Section 179
- On every original issue of debt instruments,
- There shall be collected a DST of P1.50 on each P200, or fractional part thereof of the issue price
of any such debt instruments
- Provided, that for such debt instruments with terms of less than 1 year, DST to be collected shall be
of proportional amount in accordance with ratio of its term in number of days to 365 days
- Provided further that only 1 DST shall be imposed on either loan agreement or PN issued to secure
such loan.
 Bills of Exchange or Drafts
o Section 180
- On all bills of exchange (between points within the Philippines) or drafts,
- there shall be collected a documentary stamp tax of P0.60 on each P200, or fractional part
thereof, of the face value of any such bill of exchange or draft.
 Acceptance of Foreign-Drawn Bills of Exchange
o Section 181
- Upon any acceptance or payment of any bill of exchange or order for the payment of money
purporting to be drawn in a foreign country but payable in the Philippines
- There shall be collected a DST of P0.60 on each P200 or fractional part thereof of the face value
of any such bill of exchange or order or the Philippine equivalent of such value if expressed in
foreign currency
 Foreign Bills of Exchange and letters of Credit
o Section 182
- On all foreign bills of exchange and letter of credit (including orders, by telegraph or otherwise,
for the payment of money issued by express or steamship companies or by any person or persons)
drawn in but payable out of the Philippines in a set of three (3) or more according to the custom
of merchants and bankers,
TAXATION II
Atty. Susan Aquino
5 April 2018
- there shall be collected a documentary stamp tax of P0.60 on each P200, or fractional part
thereof, of the face value of any such bill of exchange or letter of credit, or the Philippine
equivalent of such face value, if expressed in foreign currency.
 Life Insurance Policies
o Section 183
- On all policies of insurance or other instruments by whatever name the same may be called,
whereby any insurance shall be made or renewed upon any life or lives, there shall be collected
a one-time DST at the following rates:
If amount of insurance DST
< P100,000 Exempt
>P100,000 to P300,000 P20.00
>P300,000 to P500,000 P50.00
>P500,000 to P750,000 P100.00
>P750,000 to P1,000,000 P150.00
>P1,000,000 P200.00
 Non-Life Insurance Policies
o Section 184
- On all policies of insurance or other instruments by whatever name the same may be called, by
which insurance shall be made or renewed upon property of any description, including rents or
profits, against peril by sea or on inland waters, or by fire or lightning, there shall be collected a
documentary stamp tax of P0.50 on each P4.00, or fractional part thereof, of the amount of
premium charged:
- Provided, however, That no DST shall be collected on reinsurance contracts or on any instrument
by which cession or acceptance of insurance risks under any reinsurance agreement is effected
or recorded.
 Fidelity Bonds and Other Insurance Policies
o Section 185
- On all policies of insurance or bonds or obligations of the nature of indemnity for loss, damage or
liability made or renewed by any person, association, company or corporation transacting the
business of accident, fidelity, employer’s liability, plate, glass, steam, boiler, burglar, elevator,
automatic sprinkler, or other branch of insurance (except life, marine, inland, and fire insurance),
and all bonds, undertakings, or recognizances, conditioned for the performance of the duties of
any office or position, for the doing or not doing of anything therein specified, and on all
obligations guaranteeing the validity or legality of any bond or other obligations issued by any
province, city, municipality, or other public body or organization, and on all obligations
guaranteeing the title to any real estate, or guaranteeing any mercantile credits, which may be
made or renewed by any such person, company or corporation, there shall be collected a DST of
P0.50 on each P4.00, or fractional part thereof, of the premium charged.
 Annuities and Pre-Need Plans
o Section 186
- On all policies of annuities, or other instruments by whatever name the same may be called,
whereby an annuity may be made, transferred or redeemed,
- there shall be collected a DST of P1.00 on each P200, or fractional part thereof, of the premium or
installment payment on contract price collected.
- On pre-need plans, the DST shall be P0.40 on each P200, or fractional part thereof, of the premium
or contribution collected
 Indemnity Bonds
o Section 187
- On all bonds for indemnifying any person, firm or corporation who shall become bound or
engaged as surety for the payment of any sum of money or for the due execution or performance
of the duties of any office or position or to account for money received by virtue thereof, and on
TAXATION II
Atty. Susan Aquino
5 April 2018
all other bonds of any description, except such as may be required in legal proceedings, or are
otherwise provided for herein,
- there shall be collected a DST of P0.30 on each P4.00, or fractional part thereof, of the premium
charged.
 Certificates
o Section 188
- On each certificate of damage or otherwise, and on every other certificate or document issued
by any customs officer, marine surveyor, or other person acting as such, and on each certificate
issued by a notary public, and on each certificate of any description required by law or by rules
or regulations of a public office, or which is issued for the purpose of giving information, or
establishing proof of a fact, and not otherwise specified herein, there shall be collected a DST of
P30.00.
 Warehouse Receipts
o Section 189
- On each warehouse receipt for property held in storage in a public or private warehouse or yard
for any person other than the proprietor of such warehouse or yard,
- there shall be collected a DST of P30.00: Provided, That no tax shall be collected on each
warehouse receipt issued to any one person in any one calendar month covering property the
value of which does not exceed P200.
 Jai-Alai Horse Race, Lotto, Etc.
o Section 190
- On each jai-alai, horse race ticket, lotto, or other authorized numbers games,
- there shall be collected a DST of P0.20:
- Provided, That if the cost of the ticket exceed P1.00, an additional tax of Twenty centavos P0.20
on every P1.00, or fractional part thereof, shall be collected
 Bills of Lading or Receipts
o Section 191
- On each set of bills of lading or receipts (except charter party) for any goods, merchandise or
effects shipped from one port or place in the Philippines (except on ferries across rivers), or to any
foreign port,
- there shall be collected a DST of P2.00,
 P 2.00 if the value of such goods >P100 to P1,000;
 P20.00, if the value >P1,000
- Provided, however, That freight tickets covering goods, merchandise or effects carried as
accompanied baggage of passengers on land and water carriers primarily engaged in the
transportation of passengers are hereby EXEMPT
 Proxies
o Section 192
- On each proxy for voting at any election of officers of any company or association, or for any
other purpose
- EXCEPT proxies issued affecting affairs of association or corporations organized for religious,
charitable or literary purposes
- there shall be collected a DST of P30.00
 Powers of Attorney
o Section 193
- On each power of attorney to perform an act whatsoever
- EXCEPT acts connected with the collection of claims due from or accruing to the Government or
government of any province, city or municipality
- There shall be collected a DST of P10.00
TAXATION II
Atty. Susan Aquino
5 April 2018
 Leases of Real Property
o Section 194
- On each lease, agreement, memorandum or contract for hire, use or rent of any lands or
tenements, or portions thereof,
- There shall be collected a DST of P6.00 for the first P200 or fractional part thereof,
- And additional P2.00 for every P1,000 or fractional part thereof, in excess of P2000 for each year
of term of said contract or agreement.
 Mortgages, Pledges, Deeds of Trust
o Section 195
- On every mortgage or pledge of lands, estate, or property, real or personal, heritable or movable,
whatsoever,
- where the same shall be made as a security for the payment of any definite and certain sum of
money lent at the time or previously due and owing or forborne to be paid, being payable, and
on any conveyance of land, estate, or property whatsoever, in trust or to be sold, or otherwise
converted into money which shall be and intended only as security, either by express stipulation
or otherwise, there shall be collected a documentary stamp tax at the following rates:
- When the amount secured <P5,000 - P40.00
- On each P5,000 or fractional thereof >P5,000 - additional P20.00
- On any mortgage, pledge, or deed of trust, where the same shall be made as a security for the
payment of a fluctuating account or future advances without fixed limit,
 the DST on such mortgage, pledge or deed of trust shall be computed on the amount actually
loaned or given at the time of the execution of the mortgage, pledge or deed of trust,
 additional DST shall be paid which shall be computed on the basis of the amount advanced
or loaned at the rates specified above:
- Provided, however, That if the full amount of the loan or credit, granted under the mortgage,
pledge or deed of trust shall be computed on the amount actually loaned or given at the time of
the execution of the mortgage, pledge or deed of trust. However, if subsequent advances are
made on such mortgage, pledge or deed of trust, additional documentary stamp tax shall be
paid which shall be computed on the basis of the amount advanced or loaned at the rates
specified above:
- Provided, however, That if the full amount of the loan or credit, granted under the mortgage,
pledge or deed of trust is specified in such mortgage, pledge or deed of trust, the documentary
stamp tax prescribed in this Section shall be paid and computed on the full amount of the loan or
credit granted.
 Deed of Sale of Real Property
o Section 196
- On all conveyances, donations, deeds, instruments, or writings, other than grants, patents or
original certificates of adjudication issued by the Government, whereby any land, tenement, or
other realty sold
- shall be granted, assigned, transferred, donated or otherwise conveyed to the purchaser, or
purchasers, or to any other person or persons designated by such purchaser or purchasers, or
donee,
- there shall be collected a DST, at the rates herein below prescribed, based on the consideration
contracted to be paid for such realty or on its fair market value determined in accordance with
Section 6(E) of this Code, whichever is higher:
- Provided, That when one of the contracting parties is the Government, the tax herein imposed
shall be based on the actual consideration
- Consideration or value received or contracted to be paid <P1,000 - P15.00
- For each additional P1,000 or fractional part >P1,000 - P15.00
- Transfers exempt from donor’s tax under Section 101(a) and (b) shall be exempt from tax imposed
in this section
- When it appears that the amount of the documentary stamp tax payable hereunder has been
reduced by an incorrect statement of the consideration in any conveyance, deed, instrument or
TAXATION II
Atty. Susan Aquino
5 April 2018
writing subject to such tax the Commissioner, provincial or city Treasurer, or other revenue officer
shall, from the assessment rolls or other reliable source of information, assess the property of its true
market value and collect the proper tax thereon.
 Charter Party and Similar Instruments
o Section 197
- On every charter party, contract or agreement for the charter of any ship, vessel or streamer, or
any letter or memorandum or other writing between the captain, master or owner, or other person
acting as agent of any ship, vessel or steamer, and any other person or persons for or relating to
the charter of any such ship, vessel or streamer, and on any renewal or transfer of such charter,
contract, agreement, letter or memorandum, there shall be collected a documentary stamp tax
at the following rates:
If the registered gross tonnage of the ship, vessel or steamer <1,000 tons, and P1,000
the duration of the charter or contract < 6 months
 for each month or fraction of a month in excess of six (6) months + P 100
If the registered gross tonnage >1,000 tons to 10,000 tons and P2,000
the duration of the charter or contract < 6 months
 for each month or fraction of a month in excess of six (6) months + P 200
If the registered gross tonnage >10,000 tons and P3,000
the duration of the charter or contract < 6 months
 for each month or fraction of a month in excess of six (6) months + P 300
 Assignment, Transfer and Renewal of Certain instruments
o Section 198
- Upon each and every assignment or transfer of any mortgage, lease or policy of insurance, or the
renewal or continuance of any agreement, contract, charter, or any evidence of obligation or
indebtedness by altering or otherwise, there shall be levied, collected and paid a documentary
stamp tax, at the same rate as that imposed on the original instrument.

Documents/Transactions not Subject to DST

 Section 199
o The provisions of Section 173 to the contrary notwithstanding, the following instruments, documents
and papers shall be exempt from the documentary stamp tax:
(a) Policies of insurance or annuities made or granted by a fraternal or beneficiary society, order,
association or cooperative company, operated on the lodge system or local cooperation plan
and organized and conducted solely by the members thereof for the exclusive benefit of each
member and not for profit.
(b) Certificates of oaths administered to any government official in his official capacity or of
acknowledgment by any government official in the performance of his official duties, written
appearance in any court by any government official, in his official capacity; certificates of the
administration of oaths to any person as to the authenticity of any paper required to be filed in
court by any person or party thereto, whether the proceedings be civil or criminal; papers and
documents filed in courts by or for the national, provincial, city or municipal governments;
affidavits of poor persons for the purpose of proving poverty; statements and other compulsory
information required of persons or corporations by the rules and regulations of the national,
provincial, city or municipal governments exclusively for statistical purposes and which are wholly
for the use of the bureau or office in which they are filed, and not at the instance or for the use
or benefit of the person filing them; certified copies and other certificates placed upon
documents, instruments and papers for the national, provincial, city, or municipal governments,
made at the instance and for the sole use of some other branch of the national, provincial, city
or municipal governments; and certificates of the assessed value of lands, not exceeding Two
hundred pesos (P200) in value assessed, furnished by the provincial, city or municipal Treasurer
to applicants for registration of title to land.
TAXATION II
Atty. Susan Aquino
5 April 2018
 Among them are the following:
1. Insurance policies, or annuities to members of fraternal societies
2. Certificates of oath administered to and certificates of acknowledgement by any government
official in his official capacity
3. Certificate of the administration of oaths to any person or party therein as to the authenticity of
any paper
4. Affidavits of poor persons for the purpose of proving poverty
5. Statements and compulsory information required by government offices for statistical purposes and
not for the benefit of the person filing the same
6. Certified copies and other certificates placed upon documents, instruments and papers for th
national, provincial, city or municipal governments
7. Certificates of the assessed value of lands, not exceeding P200 in value assessed, furnished to
applicants for registration of title to land
8. Borrowing and lending of securities executed under the Securities Borrowing and Lending Program
of a registered exchange or in accordance with regulations prescribed by the appropriate
regulatory authority. Any borrowing or lending of securities agreement as contemplated hereof
shall be duly covered by a master securities borrowing and lending agreement acceptable to the
appropriate regulatory authority and which agreement is duly registered and approved by BIR
9. Loan agreements or PNs, the aggregate of which does not exceed P250,000 or any such amount
as may be determined by the Secretary of Finance, executed by any individual for his purchase
on installment for his personal use or that of his family and not for business or resale, barter or hire
of a house, lot, motor vehicle, appliance or furniture. Amount sent by Sec of Finance shall be in
accordance with relevant price index by not to exceed 10% of the current amount and shall
remain in force at least for 3 years
10. SBE of shares of stock listed and traded through local stock exchange
11. Assignment or transfer of any mortgage, lease or policy of insurances, or the renewal or
continuance of any agreement, contract, charter, or any evidence of obligation or indebtedness.
If there is no change in the maturity date or remaining period of coverage from that of the original
instrument
12. Fixed income and other securities traded in the secondary market or through an exchange
13. Derivatives, provided that for purposes of this exemption, repurchased agreements and reverse
repurchase agreements shall be treated similarly as derivatives
14. Interbranch or interdepartmental advances with same legal entity
15. All forbearances arising from sales or service contracts including credit card and trade receivables;
provided that the exemption be limited to those executed by the seller or service provider itself
16. Bank deposit accounts without a fixed term or maturity
17. All contracts, deals, documents and transactions related to the conduct of business of BSP
18. Transfer of property pursuant to Sec 40(c)(2) of Tax Code
19. Interbank call loans wit maturity of not more than 7 days to cover deficiency in reserves against
deposit liabilities including those between or among banks and quasi-banks (Sec 199, as amended
by PD 1994 and RA 9243)
20. Deeds of property donated to the government
21. Certificates of ownership and transfer of chattel
22. Ordinary bills of sale of personal property and sales of real property the consideration of which does
not exceed P200 and
23. Certificates of acknowledgement on the following taxable instruments when such certificates are
necessary part of the instrument
(a) Power of attorney
(b) Contract of lease of land or tenement
(c) Deeds of mortgage pledge or trust and
(d) Contracts of sale of real property (BIR Primer)

Who is Liable to pay DST

 Section 173
TAXATION II
Atty. Susan Aquino
5 April 2018
o tax shall be paid by the person making, signing, issuing, accepting or transferring such obligation, right
or property.
o Both the person who issued the document and person to whom it is issued may be made liable for the
tax.
o In case one party enjoys exemptions from the tax, the other party who is not exempted shall be the
one directly liable for the tax.
 RR 09-00 (digest)
o issued November 22, 2000 identifies the persons liable for the Documentary Stamp Tax (DST) and the
mode of payment/remittance of the said tax under certain conditions. The DST, in general, is a tax
imposed against the person making, signing, issuing, accepting or transferring the document or facility
evidencing the aforesaid transactions. Thus, in general, it may be imposed on the transaction itself or
upon the document underlying such act. Any of the parties to the taxable transaction will be liable
and responsible for the payment and remittance of the full amount of the tax due. However, whenever
one of the parties to the taxable transaction is exempt from the DST, the other party who is not exempt
shall be the one directly liable for the said tax.
o If the tax-exempt party is one of the persons constituted as agent of the Commissioner for the
collection of the tax, he shall be required to collect and remit the DST. Failure on his part to collect
and remit the DST would make him personally liable for the tax and the penalties prescribed under
Title X of the Tax Code.
o The DST on the specified cases will be remitted as follows:
1) stamp tax on bonds, debentures, certificates of indebtedness, deposit substitute, or other similar
instruments - to be remitted by the person who issued the instrument;
2) stamp tax on original issue of shares of stock in a corporation - to be remitted by the corporation
which issued the share(s) of stock; and
3) stamp tax on jai-alai, horse race, lotto or other authorized number games - to be remitted by the
proprietor or operators. Whenever one of the parties to the taxable document or transaction is
included in any of the entities enumerated in the Regulations, such entities will be responsible for
the remittance of the DST.
o The "on-line electronic DST imprinting machine", unless expressly exempted by the Commissioner, will
be used in the payment and remittance of the DST by the following class of taxpayers:
a) bank, quasi-bank or non-bank financial intermediary, finance company, insurance, surety,
fidelity, or annuity company;
b) the Philippine Stock Exchange (in the case of shares of stock and other securities traded in the
local stock exchange);
c) shipping and airline companies;
d) pre-need company (on sale of pre-need plans); and
e) other industries as may be required by the Commissioner.

DST Returns and Payments

 Section 200
 When
o Except as otherwise provided by rules and regulations
o The tax return shall be filed and tax due shall be paid at the same time within 10 days after close of
the month when taxable document was made, signed, issued, accepted or transferred
o In lieu of the foregoing, the tax may be paid either through purchase and actual affixture or by
imprinting the stamp through documentary stamp metering machine on the taxable document
 Where
o Except in cases where Commissioner otherwise permits
o Tax return shall be filed and tax due shall be paid through an authorized agent bank within territorial
jurisdiction of RDO which has jurisdiction over the residence or principal place of business of taxpayer.
o In places where there is no authorized agent bank, return shall be filed with the
 RDO, Revenue Collection Officer or
 duly authorized treasurer of the city or municipality
TAXATION II
Atty. Susan Aquino
5 April 2018
where taxpayer has his/its legal residence principal place of business.

Effect of Failure to Stamp Taxable Document

 Section 201
o An instrument, document or paper which is required by law to be stamped and which has been
signed, issued, accepted or transferred without being duly stamped, shall not be recorded, nor shall
it or any copy thereof or any record of transfer of the same be admitted or used in evidence in any
court until the requisite stamp or stamps are affixed thereto and cancelled.
 Such failure does not render the document invalid or void. But in such case the following shall be the
effects:
1. Document, instrument or paper shall not be recorded in the government registry
2. Such DIP shall not be admitted or used in evidence in any court until the requisite stamp or stamps
shall have been affixed thereon and cancelled (Par 1, Sec 201)
3. No notary public or other official authorized to administer oaths shall add his jurat or
acknowledgement until the document is properly stamped and
4. In case of failure to affix proper documentary stamps to a DIP, there shall for every violation be
imposed in addition to amount of tax required to be paid , an amount equivalent to 25% of such
unpaid amount as surcharge (Sec 248(a)) and 20% interest per annum from date prescribed for
payment until the amount is fully paid (Sec 249(a))

RR 4-2018
 Providing the Rules and Regulations Implementing DST Rate Adjustments under Train Law
 The summary of changes in the DST rates are as follows:
a. The rate of DST on the original issue of shares has been increased from One Peso (P1.00) to Two
Pesos (P2.00) on each Two Hundred Pesos (P 200), or fractional part thereof, of the par value of
such shares of stock.
b. The rate of DST on sales, agreements to sell, memoranda of sales, deliveries or transfer of shares or
certificates of stock has been increased from Seventy-Five Centavos (P 0.75) to One Peso and Fifty
Centavos (P 1.50) on each Two Hundred Pesos (P 200), or fractional part thereof, of the par value
of such stock. In case of stocks without par value, the DST shall be equivalent to Fifty Percent (50%)
of the DST paid upon the original issue of said stock.
c. The rate of DST on the Certificates of Profits or Interest in Property or Accumulations has been
increased from Fifty Centavos (P 0.50) to One Peso (P 1.00) on each Two Hundred Pesos, or
fractional part thereof, of the face value of such certificates or memorandum.
d. The rate of DST on bank checks, drafts, certificates of deposit not bearing interest, and other
instruments has been increased from One Peso and Fifty Centavos (P 1.50) to Three Pesos (P 3.00).
e. The rate of DST on all debt instruments is increased from One Peso (P 1.00) to One Peso and Fifty
centavos (P 1.50) on each Two Hundred Pesos (P 200.00), or fractional part thereof, of the issue
price of any such debt instruments.
f. The rate of DST on all bills of exchange or drafts has been increased from Thirty Centavos (P 0.30)
to Sixty Centavos (P 0.60) on each Two Hundred Pesos (P 200.00), or fractional part thereof, of the
face value of any such bill of exchange or draft.
g. The rate of DST on acceptance of bills of exchange and others all bills of exchange or drafts has
been increased from Thirty Centavos (P 0.30) to Sixty Centavos (P 0.60) on each Two Hundred Pesos
(P 200.00), or fractional part thereof, of the face value of any such bill of exchange or draft, or the
Philippine equivalent of such value, if expressed in foreign currency.
h. The rate of DST on all bills of exchange or drafts has been increased from Thirty Centavos (P 0.30)
to Sixty Centavos (P 0.60) on each Two Hundred Pesos (P 200), or fractional part thereof, of the face
value of any such bill of exchange or letter of credit, or the Philippine equivalent of such face value,
if expressed in foreign currency.
i. On all policies of insurance or other instruments by whatever name the same may be called,
whereby any insurance shall be made or renewed upon any life or lives, there shall be collected a
one-time DST at the following rates:
TAXATION II
Atty. Susan Aquino
5 April 2018

If amount of insurance DST

< P100,000 Exempt
>P100,000 to P300,000 P20.00
>P300,000 to P500,000 P50.00
>P500,000 to P750,000 P100.00
>P750,000 to P1,000,000 P150.00
>P1,000,000 P200.00
Rates of DST on life insurance policies have been doubled
j. The rate of DST on annuities has been increased from Fifty Centavos (P 0.50) to One Peso (P 1.00)
on each Two Hundred Pesos (P 200), or fractional part thereof, of the premium or installment
payment on contract price collected. Pre-need plans are now taxed at Forty Centavos (P 0.40)
from the previous rate of Twenty Centavos (P 0.20).
k. The rate of DST on certificates has been increased from Fifteen Pesos (P 15.00) to Thirty Pesos (P
30.00).
l. The rate of DST on warehouse receipts has been increased from Fifteen Pesos (P 15.00) to Thirty
Pesos (P 30.00).
m. The rate of DST on jai-alai, horse race, tickets, lotto, or other authorized number game has been
increased from Ten Centavos (P 0.10) to Twenty Centavos (P 0.20); and if the cost of ticket exceeds
One Peso (P 1.00), the additional tax has been increased from Ten Centavos (P 0.10) to Twenty
Centavos (P 0.20) on every One Peso (P 1.00), or fractional part thereof.
n. The rate of DST on each bill of lading or receipt has been increased from One Peso (P 1.00) to Two
Pesos (P 2.00), if the value of goods exceeds One Hundred Pesos (P 100) and does not exceed One
Thousand Pesos (P 1,000); and the rate of DST has been increased from Ten Pesos (P 10.00) to Twenty
Pesos (P 20.00), if the value of goods exceeds One Thousand Pesos (P 1,000)
o. The rate of DST on each proxy has been increased from Fifteen Pesos (P 15.00) to Thirty Pesos (P
30.00)
p. The rate of DST on each Power of Attorney has been increased from Five Pesos (P 5.00) to Ten Pesos
(P 10.00).
q. The rate of DST on leases and other hiring agreements has been increased from Three Pesos (P 3.00)
to Six Pesos (P 6.00) for the first Two Thousand Pesos (P 2,000), or fractional part thereof; and the
additional tax was increased from One Peso (P 1.00) to Two Pesos (P 2.00) for every One Thousand
Pesos (P 1,000) or fractional part thereof, in excess of the first Two Thousand Pesos (P 2,000).
r. The rate of DST on every mortgage, pledge, or deed of trust has been increased from Twenty Pesos
(P 20.00) to Forty Pesos (P 40.00), when amount secured does not exceed Five Thousand Pesos (P
5,000); and the additional tax has been increased from Ten Pesos (P 10.00) to Twenty Pesos (P
20.00), on each Five Thousand Pesos (P 5,000), or fractional part thereof in excess of Five Thousand
Pesos (P 5,000)
s. The rates of DST on charter parties and similar instruments have been doubled.
t.
 Donations of real property shall now be subject to DST under the amended Section 196. However, the
following donations or gifts exempt from Donor’s Tax under Section 101 (A) and (B) shall be exempt from
DST:
(A) In the Case of Gifts Made by a Resident
i. Gifts made to or for the use of the National Government or any entity created by any of its
agencies which is not conducted for profit, or to any political subdivision of the said
Government; and
ii. Gifts in favor of an educational and/or charitable, religious, cultural or social welfare
corporation, institution, accredited non-government organization, trust or philanthropic
organization or research institution or organization: Provided, however, that not more than thirty
percent (30%) of said gifts shall be used by such donee for administration purposes. For the
purpose of this exemption, a 'non- profit educational and/or charitable corporation, institution,
accredited non- government organization, trust or philanthropic organization and/or research
institution or organization' is a school, college or university and/or charitable corporation,
TAXATION II
Atty. Susan Aquino
5 April 2018
accredited non-government organization, trust or philanthropic organization and/or research
institution or organization, incorporated as a non- stock entity, paying no dividends, governed
by trustees who receive no compensation, and devoting all its income, whether students' fees
or gifts, donation, subsidies or other forms of philanthropy, to the accomplishment and
promotion of the purposes enumerated in its Articles of Incorporation.
(B) In the Case of Gifts Made by a Non-resident not a Citizen of the Philippines
i. Gifts made to or for the use of the National Government or any entity created by any of its
agencies which is not conducted for profit, or to any political subdivision of the said
Government.
ii. Gifts in favor of an educational and/or charitable, religious, cultural or social welfare
corporation, institution, foundation, trust or philanthropic organization or research institution or
organization. Provided, however, that not more than thirty percent (30%) of said gifts shall be
used by such donee for administration purposes.

RMC 3-2018
 Providing Transition Procedures for all Taxpayers affected by Revised Rates on DST Pursuant to Provisions
of Train Law