Candles Produced Principally from Paraffin Wax are Subject to Specific Tax on Their Wax Content

August 16, 1991 BIR RULING NO. 154-91 145 (a) (3) 000-77 154-91 S i r : This refers to your letter dated November 21, 1990 requesting a ruling as to whether candles made of paraffin wax are subject to the specific tax under Section 145 (a) (3) of the Tax Code. In reply, please be informed that wax without distinction whether derived from petroleum products or from plant or animal sources (paraffin wax) is subject to specific tax (BIR Ruling dated January 28, 1977). Accordingly, candles produced principally from paraffin wax are subject to specific tax on their wax content pursuant to Section 145 (a) (3) of the Tax Code and to 10% VAT under Section 100 or 101 of the same Code as amended by Executive Order No. 273. (BIR Ruling dated March 18, 1975 issued to Pacific Candle Factory) With respect to your request to be advised on the jurisdiction of the Bureau of Customs to hear protest cases involving the collection of internal revenue taxes, please be informed that under Section 1708 of the Tariff Customs Code, R.A. 1937, as amended by P.D. No. 24, reading "SEC. 1708. Claim for Refund of Duties and Taxes and Modes of Payment . . . . "If as a result of the refund of customs duties there would necessarily result a corresponding refund of internal revenue taxes on the same importation, the Collector shall likewise certify the same to the Commissioner who shall cause the said excess taxes to be paid, refunded, or tax credited in favor of the importer, with advice to the Commissioner of Internal Revenue." since the Commissioner of Customs is vested with jurisdiction to refund/credit internal revenue taxes in favor of the importer, with advice to the Commissioner of Internal Revenue, it can be reasonably inferred that the power to adjudicate assessment involving internal revenue taxes on imported articles attaches to the Customs Commissioner's power to refund/credit internal revenue taxes to the importers. Accordingly, protests involving internal revenue tax assessments should not be lodged with the BIR; thus paragraph V of the Customs Administrative Order No. 226 dated December 3, 1957 stating that the Collector of Customs must transmit to the Collector (now Commissioner) of Internal Revenue is no longer applicable. aisadc Very truly yours, (SGD.) EUFRACIO D. SANTOS Deputy Commissioner Officer-in-Charge