Tax Imposed on the Production of Alcohol

October 27, 1958 BIR RULING NO. 607-58 Mr. Florentino Granada Isabela, Negros Occidental S i r : Your letter addressed to the Institute of Science and Technology, Manila, dated December 23, 1957, was referred to this Office for action in connection with query (c) which reads: cdll "What Constitutional laws will an individual be subjected if he want to produce alcohol." In this connection, please be informed that the production of alcohol does not involve matters on constitutional law. For the production of alcohol from molasses, you are, for tax purposes, considered a distiller of spirits, subject to a fixed tax per annum in the amount of P100.00, if your annual production does not exceed fifty thousand gauge liters; P200.00, if the annual production exceeds fifty thousand gauge liters but does not exceed one hundred thousand gauge liters; P400.00, if the annual production exceeds one hundred thousand gauge liters but does not exceed two hundred and fifty thousand gauge liters; and P600.00, if the annual production exceeds two hundred and fifty thousand gauge liters. On the alcohol to be produced by you, you are subject to a specific tax of P0.45 per proof liter. Before engaging in business as distiller of spirits or before issuance of permit to operate a factory producing articles subject to specific tax, a written application for such purpose shall first be made and filed with the Commissioner of Internal Revenue for approval, together with a blue print copy of the premises of the factory, the building or factory to be built, its location or site, equipments to be used and other pertinent data in relation to the construction of your factory and its location. Upon receipt of your application and plans by the Commissioner, the same will be referred for investigation. The Commissioner will then inform you of his decision based on the investigation as stated. If your application is approved, a permit may be issued upon posting a bond, the amount of which to be approved by the Commissioner, pursuant to Section 156 of the Tax Code. You will also be required to keep records of raw materials received into the factory or of articles produced therein, as provided for in Section 150 of the same Code, and such other books of accounts and records required by this Bureau. For further and thorough information on this particular kind of business, please refer to Regulations No. 3 of the Department of Finance and Title IV of the Tax Code. LexLib Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue