EXCISE

TAXES
EXCISE TAX

refers to an indirect type of taxation

imposed on the manufacture, sale or use
of certain types of goods and products.
APPLICABILITY

 On goods manufactured/produced in the

Philippines for domestic sale/consumption or for
any other disposition; and
 On goods imported.
RATIONALE:
The implementation of excise taxes allows the
governments the means to raise
additional revenue necessary for large projects such as
social programs.
Excise taxes are most often levied upon cigarettes,
alcohol, gasoline and gambling. These are often
considered superfluous or unnecessary goods and
services. To raise taxes on them is to raise their price
and to reduce the amount they are used. In this context,
excise taxes are sometimes known as "sin taxes."
EXCISE TAXES USUALLY FALL INTO ONE OF
TWO TYPES:

 Ad Valorem meaning that a fixed percentage is

charged on a particular good or product. This
administration of the tax is less common.
 Specific meaning that a fixed currency amount
may be imposed depending on the quantity of the
goods or products that are purchased. Specific is
the most common type.
GOODS SUBJECT TO EXCISE TAX:
1. Alcohol Products (Sections 141-143)
a. Distilled Spirits (Section 141)
b. Wines (Section 142)
c. Fermented Liquors (Section 143)
2. Tobacco Products (Sections 144-146)
a. Tobacco Products (Section 144)
b. Cigars & Cigarettes (Section 145)
c. Inspection Fee (Section 146)
3. Petroleum Products (Section 148)
4. Miscellaneous Articles (Section 149-150)
a. Automobiles (Section 149)
b. Non-essential Goods (Section 150)
5. Mineral Products (Sections 151)
BASES:

GOODS/PRODUCT BASE OF MEASUREMENT

Specific
Greases, waxes, petrolatum, asphalt Per kilogram
Lubricating oil and premium gasoline Per liter
capacity, liquefied petroleum gas
Ad Valorem
Fermented liquor, sparkling wines, Net retail price
cigarettes packed by machine
Automobiles Selling price of
manufacturer/importer
Non-essential goods Wholesale price or value of
importation
EXCISE
TAX
RATES
 A. ALCOHOL PRODUCTS
NEW TAX RATES based on Republic
PARTICULARS Act No. 10351 2018
onwards
2015 2016 2017
A. DISTILLED SPIRITS, AD VALOREM & SPECIFIC TAX
1) AD VALOREM TAX RATE - Based on
NRP per proof (excluding Excise and 20%
VAT)
Effective
1/1/2016, rate
shall be
2) SPECIFIC TAX - Per proof liter P20 P20.80 P21.63 increased by 4%
every year
thereafter
B. WINES, per liter of volume capacity
1) Sparkling wines/ champagnes, where the NRP (excluding the excise and VAT)
per bottle of 750ml, regardless of proof is:
- P500.00 or less P270.40 P281.22 P292.47
- More than P500.00 P757.12 P787.40 P818.90 Effective
2) Still/carbonated wines containing 1/1/2016, rate
alcohol volume: shall be
- 14% or less P32.45 P33.75 P35.10 increased by 4%
- more than 14%, not more 25% P64.90 P67.50 P70.20 every year
4) Fortified wines containing more than thereafter
Taxed as distilled spirits
25% of alcohol by volume
 A. ALCOHOL PRODUCTS

NEW TAX RATES based on Republic

PARTICULARS Act No. 10351 2018
onwards
2015 2016 2017
C. FERMENTED LIQUORS , per liter of volume capacity
1) If the NRP (excluding excise and VAT) per liter of volume capacity is:
- P 50.60 and below P19.00 P21.00 P23.50
Effective
1/1/2018, rate
shall be
- More than P 50.60 P22.00 P23.00 P23.50 increased by 4%
every year
thereafter
Effective
2) If brewed and sold at microbreweries 1/1/2014, rate
shall be
or small establishments such as pubs and P30.28 P31.50 P32.76 increased by 4%
restaurants, regardless of the NRP every year
thereafter
NOTE: IN CASE OF FERMENTED LIQUORS AFFECTED BY THE "NO DOWNWARD RECLASSIFICATION "
PROVISION, THE 4% INCREASE SHALL APPLY TO THEIR RESPECTIVE APPLICABLE TAX RATES
 B. TOBACCO PRODUCTS
NEW TAX RATES based on Republic Act No. 10351
PARTICULARS 2018
2015 2016 2017
onwards
A. TOBACCO PRODUCTS, per kilogram
1. Tobacco Products:
(a) Twisted by hand/reduced into a condition to be consumed
in any manner other than the ordinary mode of drying and P1.89 P1.97 P2.05
curing;
(b) Prepared/partially prepared with or w/o the use of any
P1.89 P1.97 P2.05
machine/instrument/ w/o being pressed/sweetened; and
(c) Fine-cut shorts and refuse, scraps, clippings, cuttings, stems,
P1.89 P1.97 P2.05 Effective
midribs and sweepings; 1/1/2014,
2. Chewing tobacco unsuitable for use in any other manner P1.62 P1.68 P1.75 rate shall be
B. CIGARS, per cigar increased by
4% every
3. Cigars year
thereafter
(a) Based on NRP (excluding the excise and VAT), and 20% 20% 20%
(b) Per cigar P5.41 P5.62 P5.85
C. CIGARETTES , per pack
1. Packed by hand P18.00 P21.00 P30.00
2. Packed by machine, where the NRP (excluding excise and
VAT) per pack is:
(a) P11.50 and below P21.00 P25.00 P30.00
(b) More than P11.50 P28.00 P29.00 P30.00
 B. TOBACCO PRODUCTS
INSPECTION FEE - There shall be collected inspection fees on leaf tobacco, scrap,
cigars, cigarettes and other manufactured tobacco and tobacco products as follows:

PRODUCT TYPE INSPECTION FEE

(1) Cigars P 0.50 per thousand pieces or fraction thereof
(2) Cigarettes P 0.10 per thousand sticks or fraction thereof
(3) Leaf Tobacco P 0.02 per kilogram or fraction thereof
(4) Scrap and other manufactured tobacco P 0.03 per kilogram or fraction thereof
 C. PETROLEUM PRODUCTS

PRODUCT TYPE TAX RATES

Naphtha used as raw material in the production of petrochemical products or as P 0.00 per liter
replacement fuel for natural gas-fired combined cycle power plant, in lieu of locally-
extracted natural gas during the non-availability thereof
Kerosene and Liquefied Petroleum Gas ; Provided, that if used for motive power, it P 0.00 per liter
shall be taxed at the equivalent rate as the Excise Tax on diesel fuel oil
Diesel and Bunker fuel oil, and on similar fuel oils having more or less the same P 0.00 per liter
generating power
Denatured alcohol, if used for motive power [i.e. one hundred eighty (180) proof P 0.05 per liter
ninety percent (90%) absolute alcohol]. Provided, that unless otherwise provided by
special laws, if the denatured alcohol is mixed with gasoline, the excise tax which has
already been paid, only the alcohol content shall be subject to tax
Processed gas P 0.05 per liter
Asphalt P 0.56 per
kilogram
Waxes and petrolatum P 3.50 per
kilogram
Aviation turbo jet fuel and Kerosene used as aviation fuel P 3.67 per liter
Naphtha, regular/unleaded premium gasoline and other similar products of distillation P 4.35 per liter
Lubricating oils and greases, including but not limited to base stock for lube oils and P 4.50 per liter
greases, high vacuum distillates, aromatic extracts and other similar preparations, and
additives for lubricating oils and greases, whether such additives are petroleum based
or not
Leaded premium gasoline P 5.35 per liter
D. MINERAL PRODUCTS

PRODUCT TYPE TAX RATES

On locally-extracted natural gas P0.00
and liquefied natural gas
On coal and coke P10.00 per metric ton
All mineral and mineral products 2% bases on the actual market value, in the case of
(non-metallic), quarry resources those locally-extracted or produced; and, in case of
imports or the value used by the Bureau of
Customs in determining tariff and customs duties,
net of Excise Tax and VAT.
On indigenous petroleum Three percent (3%) of the fair international market
price thereof
NOTE:
In the case of mineral concentrates not traded in commodity exchanges in the
Philippines or abroad, such as copper concentrate, the actual market value shall be the
world price quotations of the refined mineral products content thereof prevailing in
the said commodity exchanges, after deducting the smelting, refining and other
charges incurred in the process of converting the mineral concentrates into refined
metal traded in those commodity exchanges.
On minerals and mineral products sold or consigned abroad, the actual cost of ocean
freight and insurance shall be deducted from the tax base.
E. AUTOMOBILES AND OTHER VEHICLES

OVER UP TO RATE
0 P 600,000 2%
P600,000 P 1,100,000 P 12,000 + 20% in excess of P 600,000
P1,100,000 P2,100,000 P112,000+ 40% in excess of P1,100,000
P2,100,000 over P512,000 + 60% in excess of P2,100,000

F. Non-essential Goods

 Twenty percent (20%) based on the wholesale price or the value

of importation used by the Bureau of Customs in determining
Tariff and Customs Duties, net of Excise and VAT.
MANNER OF COMPUTATION:

 Specific Tax = No. of Units x Specific Tax Rate

 Ad Valorem Tax = No. of Units x Selling Price per
unit x Ad Valorem Tax Rate
WHO ARE LIABLE TO PAY EXCISE TAX?
a. On Domestic or Local Articles
 Manufacturer

 Producer

 Owner or person having possession of articles removed from

the place of production without the payment of the tax
b. On Imported Articles
 Importer

 Owner

 Person who is found in possession of articles which are

exempt from excise taxes other than those legally entitled to
exemption
c. On Indigenous Petroleum
 Local Sale, Barter or Transfer

 First buyer, purchaser or transferee

 Exportation

 Owner, lessee, concessionaire or operator of the mining

claim
WHEN IS EXCISE TAX PAID?

• On domestic products
- Before removal from the place of production
• On imported products
- Before release from the customs' custody
I. RELATED REVENUE ISSUANCES

A. ALCOHOL PRODUCTS

RMC 18-2013 Further Clarifying the Taxability of Distilled Spirits Provided under Revenue Memorandum
Circular No. 3-2013
RMC 3-2013 Clarifying Certain Provisions of Revenue Regulations No. 17-2012 Implementing the Provisions
of Republic Act No. 10351 as well as the Provisions of Revenue Memorandum Circular No. 90-
2012 Providing the Initial Tax Classifications of Alcohol and Tobacco Products
RMC 90-2012 Revised Tax Rates of Alcohol and Tobacco Products Under Republic Act No. 10351
RR 17-2012 Prescribing the Implementing Guidelines on the Revised Tax Rates on Alcohol and Tobacco
Products Pursuant to the Provisions of Existing Revenue Regulations
RR 2-97 Revenue Regulations Governing Excise Taxation on Distilled Spirits, Wines and Fermented
Liquors
RR 3-2006 Prescribing the Implementing Guidelines on the Revised Tax Rates on Alcohol and Tobacco
Products pursuant to the Provisions of Republic Act No. 9334, and Clarifying Certain Provisions
of Existing Revenue Regulations Relative Thereto
B. TOBACCO PRODUCTS

RMO 23-2013 Guidelines and Procedures for the Implementation of the Electronic Official Register Bo
(eORB) System
RR 3-2013 Prescribing the Use of Electronic Official Register Book for Manufacturers of Tobacco Produc
and Regulated Raw Materials
RMC 3-2013 Clarifying Certain Provisions of Revenue Regulations No. 17-2012 Implementing the Provisio
of Republic Act No. 10351 as well as the Provisions of Revenue Memorandum Circular No. 9
2012 Providing the Initial Tax Classifications of Alcohol and Tobacco Products
RMC 90-2012 Revised Tax Rates of Alcohol and Tobacco Products Under Republic Act No. 10351
RR 17-2012 Prescribing the Implementing Guidelines on the Revised Tax Rates on Alcohol and Tobac
Products Pursuant to the Provisions of Existing Revenue Regulations
RR 3-2006 Prescribing the Implementing Guidelines on the Revised Tax Rates on Alcohol and Tobac
Products pursuant to the Provisions of Republic Act No. 9334, and Clarifying Certain Provisio
of Existing Revenue Regulations Relative Thereto
RR 1-97 Revenue Regulations Governing the Excise Taxation of Cigars and Cigarettes
C. Petroleum Products

RMC 50-2014 Reiteration and Clarification on the Requirement of Issuance of Withdrawal Certificate for Ever
Removal of Petroleum or Petroleum Products
RR 2-2012 Tax Administration Treatment of Petroleum and Petroleum Products Imported into th
Philippines Including those Coming in Through Freeport Zones and Economic Zones an
Registration of All Storage Tanks, Facilities, Depots and Terminals
RR 8-2006 Prescribing the Implementing Guidelines on the Taxation and Monitoring of the Raw Material
Used and the Bioethanol-Blended Gasoline (E-Gasoline) Produced under the Fuel Bioethano
Program of the Department of Energy (DOE)
RR 8-96 An Act Restructuring the Excise Tax on Petroleum Products, Reclassifying Natural Gas an
Liquefied Natural Gas under Non-Metallic Mineral and Quarry Resources and Reducing th
Excise Tax on Indigenous Petroleum
RR 13-77 Petroleum Products Regulation
D. Miscellaneous Articles

D.1 automobiles:

RMO 21-2013 Amending the Provisions of Revenue Memorandum Order (RMO) No. 35-2002, as Am
by RMO No. 20-2006 Prescribing the Guidelines and Procedures in the Processin
Issuance of Authority to Release Imported Goods (ATRIG) for Excise Tax Purposes
RMO 20-2006 Amendment to Certain Sections of RMO No. 35-2002
RMC 60-2003 Clarifying Certain Issues Raised Relative to the Implementation of Revenue Regulatio
25-2003 Governing the Imposition of Excise Tax on Automobiles Pursuant to Republic A
9224
RR 25-2003 Amended Revenue Regulations Governing the Imposition of Excise Tax on Autom
pursuant to the Provisions of Republic Act No. 9224, an Act Rationalizing the Excise T
Automobiles, Amending for the Purpose the NIRC of 1997, and for Other Purposes
RR 4-2003 Amending Certain Section of Revenue Regulations No. 14-97, as Amended by Re
Regulations No. 14-99, Otherwise Known as the Revenue Regulations Governin
Imposition of Excise Tax on Automobiles
RR 14-99 Amending Section 2 of Revenue Regulations No. 14-97 Otherwise known as Re
Regulations Governing the Imposition of Excise Taxes on Automobiles and Other
Vehicles
RR 14-97 Revenue Regulations Governing the Imposition of Excise Tax on Automobiles and Other
Vehicles

D.2 NON-ESSENTIAL GOODS:

RMC 33-2004 Revised Rules and Regulations Implementing Republic Act No. 8502, Otherwise Known A
“Jewelry Industry Development Act Of 1998”
RMC 17-2002 Green Cross Baby Cologne and All Other Cologne Products
RR 1-99 Rules and Regulations Implementing the Tax Incentives Provided under Section 3 (b) a
of Republic Act No. 8502 Otherwise known as the “Jewelry Industry Development Act of
RR 8-84 Cosmetic Products Regulations
E. MINERAL PRODUCTS

RR 7-2008 Taxation on the Sale to the Bangko Sentral ng Pilipinas of Gold and Other Metallic Mineral Prod
Extracted or Produced by Small-scale Miners and further Amending Section 2.57.2 (t) of Rev
Regulations No. 2-98, as amended
RR 13-94 Revenue Regulations Governing the Imposition of Excise Tax on Minerals and Mineral Produ

F. OTHERS (COMMON ISSUANCES FOR ALL EXCISABLE PRODUCTS)

RMO 14-2014 Guidelines and Procedures for the Processing and Issuance of An Electronic Authori
Release Imported Goods (eATRIG) for Excise Tax Purposes
RMC 10-2013 Transition Procedures for all Electronic Filing and Payment System (eFPS) Filers in Filing
Returns Affected by the Revised Tax Rates on Alcohol and Tobacco Products Pursuant to
provisions of Republic Act No. 10351, “An Act Restructuring the Excise Tax on Alcohol
Tobacco Products by Amending Sections 141, 142, 143, 144, 145, 8, 131 and 288 of Rep
Act No. 8424, Otherwise Known as the National Internal Revenue Code of 1997, as Amen
by republic Act No. 9334, and for Other Purposes
RMO 38-2003 Prescribing Uniform Guidelines and Procedures in the Processing of Various Permits for Ex
Tax Purposes
RMO 35-2002 Prescribing the Guidelines and Procedures in the Processing and Issuance of Authori
Release Imported Goods (ATRIG) for Excise and Value-Added Tax Purposes
II. CODAL REFERENCE:

SECTION IN THE NIRC OF 1997,

PARTICULAR
AS AMENDED
ALCOHOL PRODUCTS 141-143
TOBACCO PRODUCTS 144-147
PETROLEUM PRODUCTS 148
MISCELLANEOUS ARTICLES 149-150
MINERAL PRODUCTS 151