Polyethylene Wax Not Subject to Excise Tax

October 26, 1999 BIR RULING NO. 168-99 148 (c)-000-00-168-99 Unilox Industrial Corporation 194 Concepcion St., San Joaquin Pasig City Attention: Ms . Margaret T . Villena Accounting/Administrative Manager Gentlemen : This refers to your letter dated May 21, 1997 requesting for a ruling as to whether or not POLYETHYLENE (PE) WAX which you import from South Korea should be subjected to an excise tax imposed under Section 148(c) of the Tax Code of 1997 (then Section 145 of the Tax Code, as amended). cdlex In reply, please be informed that pursuant to Section 148(c), Chapter V of the 1997 Tax Code, which provides that "CHAPTER V EXCISE TAX ON PETROLEUM PRODUCTS "SEC. 148. Manufactured Oils and Other Fuels . There shall be collected on refined and manufactured mineral oils and motor oils and motor fuels, the following, excise taxes which shall attach to the goods hereunder enumerated as soon as they are in existence as such: "xxx xxx xxx "(c) Waxes and petrolatum, per kilogram, Three pesos and fifty centavos (P3.50);" a specific tax of P3.50 is being imposed on petroleum-based waxes and petrolatum. It is noted that result of the laboratory analysis forwarded to this Office, on September 3, 1999, by the BIR Tax Fraud Division through the Assistant Commissioner for Enforcement Service, Atty. Percival T. Salazar, effectively classifies the subject article as a synthetic wax produced by high pressure polymerization of ethylene (gas), and which is, therefore, not a petroleum based wax. In the light of the foregoing, this Office is of the opinion as it hereby holds that POLYETHYLENE (P.E.) WAX, not being a petroleum based wax, is not subject to excise tax imposed under Section 148(c) of the 1997 Tax Code. This ruling is being issued on the basis of the foregoing facts as represented. However, if upon investigation, it will be disclosed that the facts are different, then this ruling shall be considered null and void. Very truly yours, (SGD.) BEETHOVEN L. RUALO Commissioner of Internal Revenue