The Specific Tax Department — Its Organization and Functions

August 1, 1964 REVENUE ADMINISTRATIVE ORDER NO. 03-64 SUBJECT : The Specific Tax Department Its Organization and Functions TO : All Internal Revenue Officers and Others Concerned Pursuant to the provisions of Republic Act No. 4164 otherwise known as the Appropriations Law for the fiscal year 1964-1965, creating an additional department in the Bureau of Internal Revenue, there is hereby organized the Specific Tax Department which shall be directly the supervision and control of the Commissioner of Internal Revenue. It shall be the general objective of the Specific Tax Department to assist all organizational levels of management in the Bureau to effectively carry out the policies and procedures relative to the administration and enforcement of the internal revenue law on specific taxes. I. Organization : The head of the Specific Tax Department shall be a Revenue Operations Head who shall be responsible for carrying out the duties and functions of the Department. He shall be assisted by an Assistant Revenue Operations Head who shall be the second highest ranking official in the Department. In the absence of the Revenue Operations Head, the Assistant Revenue Operations Head shall act for and in behalf of the former. LibLex The Specific Tax Department shall have four (4) divisions under it, namely: 1. Tobacco & Miscellaneous Tax Division; 2. Alcohol Tax Division; 3. Tobacco Inspection Service; and 4. Specific Tax Enforcement Division The above-mentioned units of organization which are currently operating under the Assessment Department are hereby transferred to the Specific Tax Department which shall include for this purpose the transfer of all the personnel, equipment, supplies, records and documents of the said divisions. II. Functions : A. Specific Tax Department 1. Performs staff, advisory and supervisory functions. 2. Implements policies formulated by the Commissioner of Internal Revenue on a nationwide scope as regards the assessment of all specific taxes. 3. Administers and directs the assessment function insofar as specific taxes are concerned and recommends adoption of instructions, rules, regulations, manuals, forms, etc., in furtherance thereof. 4. Sets up standard techniques and procedures relative to the administration of the internal revenue law on specific taxes. 5. Exercises guidance over regional and inspection district offices, on operational matters relating to assessment of specific taxes. 6. Plans and recommends the allocation, transfer and promotion of all personnel in the Department. 7. Keeps records of and prepares statistical charts on the performance of its personnel. 8. Assumes such other related functions as may be assigned to it from time to time by the Commissioner of Internal Revenue. LLpr B. Tobacco & Miscellaneous Tax Division 1. Evaluates and reviews field audit reports on specific taxes on cigars, cigarettes and other manufactured products of tobacco, matches, firecrackers, manufactured oil and other fuels, coal, bunker fuel oil, diesel fuel oil, cinematographic films, playing cards and saccharine on cases involving assessments of over P10,000 and prepares appropriate action thereon. 2. Formulates programs and proposes regulations relative to the administration of specific taxes on cigars, cigarettes and other manufactured products of tobacco, matches, firecrackers, manufactured oil and other fuels, coal, bunker fuel oil, diesel fuel oil, cinematographic films, playing cards and saccharine. 3. Formulates and recommends policies, methods and procedures for the effective control and supervision of all establishments manufacturing or dealing in cigars, cigarettes and other manufactured products of tobacco, matches, firecrackers, manufactured oil and other fuels, coal, bunker fuel oil, diesel fuel oil, cinematographic films, playing cards and saccharine. 4. Passes upon protested cases involving specific taxes on cigars, cigarettes and other manufactured products of tobacco, matches, firecrackers, manufactured oil and other fuels, coal, bunker fuel oil, diesel fuel oil, cinematographic films, playing cards and saccharine, prior to action by the Appellate Division. 5. Processes all requests for operation of establishments manufacturing or dealing in cigars, cigarettes and other manufactured products of tobacco, matches, firecrackers, manufactured oil and other fuels, coal, bunker fuel oil, diesel fuel oil, cinematographic films, playing cards and saccharine. 6. Processes all requests for release of imported articles from the Bureau of Customs either as finished products or as raw materials to be used in the manufacture of cigars cigarettes, matches, firecrackers, manufactured oil and other fuels, coal, bunker fuel oil, diesel fuel oil, cinematographic films, playing cards and saccharine. 7. Processes all requests for tax clearance of cinematographic films before censorship by the Philippine Board of Review for Moving Pictures. 8. Processes and recommends for approval bonds filed by taxpayers relating to specific taxes administered by the Division. 9. Keeps and maintains records and statistics germane to division activities. 10. Develops programs and methods to promote the efficiency of the personnel in the Division and the Alcohol Tax Branch in Regional Offices. C. Alcohol Tax Division 1. Evaluates and reviews field audit reports on specific taxes on alcoholic products involving assessments of over P10,000 and prepares appropriate action thereon. 2. Formulates programs and proposes regulations relative to the administration of specific taxes on alcoholic products. 3. Formulates and recommends policies, methods and procedures for the effective control and supervision of all establishments dealing in alcoholic products. 4. Passes upon protested cases involving specific taxes on alcoholic products prior to action by the Appellate Division. 5. Processes all requests for operation of establishments manufacturing or dealing in alcoholic products. 6. Processes all requests for release of imported articles from the Bureau of Customs either as finished products or as raw materials to be used in the manufacture of alcoholic products. 7. Processes and recommends for approval all bonds filed by taxpayers relating to specified taxes on alcoholic products. 8. Develops programs and methods to promote the efficiency of the personnel in the Division and the Alcoholic & Tobacco Tax Branch in Regional Offices. 9. Develops programs and methods to promote the efficiency of the personnel in the Division and the Alcohol & Tobacco Tax Branch in Regional Offices. D. Tobacco Inspection Service 1. Implements and enforces the provisions of Sections 182(A)(3)(m) and 302 of the National Internal Revenue Code in Relation to Act No. 2613, as amended, and Revenue Regulations Nos. 17 and 47, Revenue Regulations No. V-15, V-50, V-52 and V-59 all of the Department of Finance. 2. Establishes general and local rules on classification, grading, marking and packing of leaf tobacco for domestic sales, factory use or for export. 3. Establishes adequate rules defining the standard and type of leaf and manufactured tobacco which may be exported. 4. Inspects cigars, cigarettes, leaf tobacco, partially manufactured products of tobacco for export. 5. Supervises to operation of and issuance of L-3 and B-14(a) permits to wholesale and retail leaf tobacco dealers. cdt E. Specific Tax Enforcement Division 1. Counterchecks the permissive and enforcement functions of regional offices through spot-checking, inspection and stock-taking of such persons, firms, or establishments manufacturing, producing, processing, dealing or handling articles subject to specific taxes. 2. Conducts appropriate surveillance in the field for the apprehension of fake, counterfeit, spurious and re-used stamps or labels and the illicit printing or importation of such fake, counterfeit, spurious and re-used stamps or labels; or of dyes, tags, apparatus or mechanical contrivances for the printing or manufacturing thereof or of untaxpaid articles; the affixture of incorrect value of strip stamps or labels to articles subject thereto; or other unlawful processes relative to the payment of specific taxes. 3. Conducts periodic examination and/or investigation of the books of accounts and other records of all cigar and cigarette factories, compounders and denaturers of alcohol or other persons or establishment handling or engaged in the manufacture or sale of articles subject to specific taxes, as well as other articles or raw materials used in the production of articles subject to specific taxes. 4. Initiates or directs the investigation or reinvestigation of such persons, firms or establishments engaged in the manufacture, production, or sale of articles subject to specific taxes (including those possessing or handling such articles and of the raw materials or things used in the manufacture thereof) upon receipt or discovery of sufficient evidence indicating tax fraud or whenever such act is called for or warranted. 5. Gathers or seizes, through legal processes, any evidence which may support deficiency specific taxes or those which may support court action for civil and/or criminal liability for tax evasion against such persons, firms or establishments. 6. Recommends the necessary assessment of specific taxes of such persons, firms or establishments without prejudice to the prosecution of all infractors of the law on the matter. 7. Upon direction of the Commissioner, to review tax cases involving persons, firms or establishments which have been elevated to the National Office by regional offices involving assessments of specific taxes over P10,000 or more. III. Repealing Clause : All other orders, circulars or provisions thereof in conflict with this Revenue Administrative Order are hereby revoked. VI. Effectivity : This Order shall take effect upon its approval. aisadc (SGD.) BENJAMIN N. TABIOS Acting Commissioner of Internal Revenue APPROVED: (SGD.) RUFINO G. HECHANOVA Secretary of Finance