Taxation during the

Commonwealth Period
(1935-1945)
1936: Addition of a surtax rate
November 15, 1937: Abolition of
Cedula Tax

The Cedula tax was abolished by the

National Assembly of the Philippines
because of the heavy burden that brings
to the poor people.
January 1, 1940: Imposing of
Residence Tax

Every inhabitant of the Philippines

over eighteen years of age who has
been regularly employed on a wage or
salary basis and on every corporation
no matter how created or organized is
subject to residence tax.
 In 1939, the Commonwealth
government drafted the National
Internal Revenue Code, introducing
major changes in the new tax system,
as follows:

1. The normal tax of three percent

and the surtax on income was replaced
by a single tax at a progressive rate.
2. Personal exemptions were reduced.
3. Corporation income tax was slightly
increased by introducing taxes on
inherited estates or gifts donated in
the name of dead persons.
4. The cumulative sales tax was
replaced by a single turnover tax of
10% on luxuries.
5. Taxes on liquors, cigarettes,
forestry products, and mining were
increased.
6. Dividends were made taxable.