PERCENTAGE TAX 3.

International Carriers
a. International air carriers doing business in the Philippines –
Percentage tax – are taxes imposed on the sale, barter, exchange, or 3% of their quarterly gross receipts
importation of goods or the sale of services, based upon the gross sales, b. International shipping carriers doing business in the
value in money or receipts desired by the manufacturers, producer, Philippines – 3% of their quarterly gross receipts
importer or seller.
4. Tax on Franchises
a. Radio and TV broadcasting companies – gross receipts
Sec. 116 – Tax on persons exempt from VAT – shall pay a tax equivalent not exceed 10M – 3% – option to be registered as VAT
to 3% of his gross quarterly sales or receipts provided that Cooperatives payer, once the option exercised, no revocation
is exempted. b. Electronic, gas and water utilities – 2% on gross receipts –
without option to register as VAT taxpayer
Persons liable to Percentage tax
1. Persons who sales or receipts are exempt from VAT a and non- 5. Tax on Overseas Dispatch, Message or Conversation Originating
VAT registered for having annual gross or receipt not exceeding from the Philippines
₱550,000 a. by telephone
b. wireless and other communication
2. Domestic common carriers and keepers of garages
Cars for rent or hire driven by the lessee; transportation Tax 10% – on the amount paid for such services
contractors, including persons who transport passengers for hire; - person paying the service to the person rendering
and other domestic carriers by land, air or water, for the transport the service
of passengers; and keepers of garages. - person rendering services required to pay and
Except: a. owners of bancas collect the tax within 20 days after the end of
b. owners of animal-drawn two-wheeled vehicles each quarter
shall pay 3% of their quarterly gross receipts
Exemptions:
>In computing 3% - minimum gross receipts a. Government
Jeepney for hire b. Diplomatic services – Embassy and Consular offices of
Manila and other cities ₱ 2,400 a foreign government
Provincial 1,200 c. International Organizations – Red Cross, UNICEF,
OXFAM, MERLIN
Public Utility Bus d. News Services – DZMM, GMA, ABS – CBN
Not exceeding 30 passengers ₱ 3,600
Exceeding 30 but not 50 passengers 6,000 6. Banks and Non-Banks Intermediaries
Exceeding 50 passengers 7,200 A. Interest, commissions and discounts from lending
activities
Taxi a. Short term maturity (not exceed 2 years) 5%
Manila and other cities ₱ 3,600 b. Medium Term (2 years not exceed 4 years) 3%
Provincial 2,400 c. Long Term maturity (over 4 years) 1%
Car for hire (with chauffeur) ₱ 3,000 B. Royalties, rentals of property, real or personal,
Car for hire (without chauffeur) 1,800 profits from exchange and all other items 5%
7. Tax on Finance Companies (same as above except royalties) A. Returns of Gross Sales, Receipts and Payment of Tax
1. Every person subject to percentage tax shall
8. Tax on Life Insurance Premium – 5% of the total premium pay within 25 days after the end of taxable
collected quarter
2. Person retiring from business subject to
9. Tax on Agents of Foreign Insurance Companies percentage tax shall notify the nearest BIR
Fire, marine and other miscellaneous within 20 days after closing the business;
2 X 5% = 10% - total premium collected unless otherwise provided by the law

10. Amusement Taxes EXCISE TAX

Shall be collected from the
a. Proprietor Excise Tax – tax imposed on certain specific goods or articles
b. Lessee or operator of, manufactured or produced in Philippines
Cabaret 18% 1. for domestic sale or consumption or for any other
Cockpit 18% disposition
Night or day club 18% 2. things imported into the Philippines
Boxing exhibitions 10%
Professional basketball games 15% Nature of Excise Tax
Jai-alai 30% Since they are LEVIES on certain product or good – therefore they
Race track 30% are tax on property

11. Tax on Winnings – horse races – 10% Kinds of Excise Tax

1. Specific tax – tax imposed and based on:
12. Tax on (A) Sale, Barter or Exchange of Shares of Stock Listed a. weight; or
and Traded through Local Stock exchange or (B) through Limited b. volume capacity; or
Public Hearing (Close held Corporations) c. any other physical unit or measurement

A – ½ of 1% = gross selling price of shares of stock sold 2. Ad Valorem tax – tax imposed and based on:
B – close held corporations – 50% of the outstanding a. selling price; or
capital owned by not more than 20 persons b. specified value of the good

25% of the shares of stock sold 4% >In case of importations in addition there:
Over 25% but not exceed 33 1/3% 2% 1. custom duties
Over 33 1/3% 1% 2. excise tax also subject to VAT

Paid by the corporation in primary offering or the seller Goods/Articles subject to Excise Taxes
in secondary offering 1. Alcohol products
a. Distilled Spirits – ST
b. Wines – ST
Payment – within 5 banking days after collection c. Fermented Liquors – AV
- Public offering – 30 days from the date of
listing of the shares of stock in the local stock 2. Tobacco Products
exchange a. Tobacco – ST
b. Cigars and Cigarettes – AV
 3. Petroleum Products – ST 3. Wines over 14% but not more than
25% of alcohol P 24
4. Miscellaneous Articles Example
a. Automobiles – AV 100 cases of wine
b. Non-essential goods – AV 12 bottles/case at 1 liter
>jewelry, precious and semis-precious stones Retail price = P625/bottle
>yachts and other vessels intended for pleasure or Excise tax = 100 X 12 = 1,200
Sports 1,200 X 1 = 1,200 (total quantity/liter)
X 300 (tax rate) =
5. Mineral Products Tax due = P360,000
Coal – ST
Non-metallic minerals and quarry resources Specific Tax on Cigars and Cigarettes
Tax per pack
Rate
1. Volume Retail price
2. Length 1. above P10/pack P12.00
3. Weight 2. above P6.50 but does not exceed P10
per pack P 8.00
>Ad Valorem tax – amount fluctuates as the price of the articles move up 3. P5.00 but does not exceed P6.50 P 5.00
and down 4. below P5.00 P 1.00
>cigars – on number
>ST = 12/8/5/1 X No. of packs =
Payment of Excise Taxes
They shall be paid:
A. In the case of Domestic Products Automobile
Manufacturer’s/Producer’s
a. before removal from the place of production – except Ad-valorem – Gasoline/Diesel – Selling Price – P400,000
otherwise provided by the law
b. locally manufactured petroleum products – 15 days from Engine Displacement (in cc)
the date of removal
B. In the case of imported articles Gasoline Diesel Tax rate
a. before the release from the custom house Up to 1600 Up to 1800 15%
1601 – 2000 1801 – 2300 35%
>No deadline of filing and payment of excise tax – unlike VAT, estate tax, 2001 – 2700 2301 – 3000 50%
donor tax and other percentage tax 2701 – over 3001 – over 100%

Specific Tax on Wines Ex: Selling Price – P400,000

1. Retail price + VAT 1600 X 400,000 = P60,000 – tax
a. P500 or less P100
b. more than P500 P300 Manufactured Oils and Other Fuels
(Per liter of volume capacity)
2. Wines containing 14% of alcohol by Lubricating oil and greases P 4.50
Volume or less P 12
Ex. 4.50 X no. of liters =
 DOCUMENTARY STAMP TAX
Meaning of DST
Documentary stamp tax – is a tax on 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 corresponding stamp
taxes

1. By whom payable – by the person making, signing, issuing,

accepting and transferring such obligations, right or property
In other words – Both the person who issued the document and
the person to whom it is issued – liable for the tax – unless otherwise
provided by the law – (one party to the taxable document is
exempted – the other party – not exempted will pay the tax)
(Paki-check din po ung mga nakalagay, BANGAG po kasi ang nag-type)
2. When payable
a. at the time the act is done @_@
b. transaction is held or accomplished
c. the time of execution; or
d. issuance of document

3. How payable – by purchasing and affixing the required documentary

stamp to the document or instrument and subsequently cancelling the
same in the prescribed manner > thru the use of tax-meter – no need
to cancelled

4. How documentary stamp cancelled

a.
b.
c.

>within 10 days – Filed – when the taxable documents were made, pay
the tax at the time the return is filed

>Where to file
1. authorized Agent Bank
2. BIR District Office
3. authorized treasurer of the city or municipality in which the
taxpayer has his legal residence or principal place of business

Document subject to tax:

>Sec. 174 – 198 – various kinds of evidence of debt issues and
acceptances

Sec. 174