Implementation of R.A. 4155 Which Took Effect June 20, 1964 Establishing a Tobacco Fund for Financing the Virginia Tobacco Industry

July 10, 1964 REVENUE MEMORANDUM CIRCULAR NO. 31-64 SUBJECT : Implementation of R.A. 4155 Which Took Effect June 20, 1964 Establishing a Tobacco Fund for Financing the Virginia Tobacco Industry TO : The Chief Accountant, the Chief of the Cash & Disbursement Division, and all Others Concerned The support given by the Central Bank of the Philippines under Republic Act Twenty-Two Sixty Five creating the Philippine Virginia Tobacco Administration (PVTA) is discontinued with the approval of Republic Act Forty One Fifty Five and in lieu thereof, " . . . a special fund is hereby established to be known as the Tobacco Fund, which shall be constituted by and collected from the proceeds of fifty per centum of the tariff or taxes on imported leaf tobacco . . . and also fifty per centum of the specific taxes on locally manufactured Virginia-type cigarettes . . . ". The law specifically directs the Commissioner of Internal Revenue and the Commissioner of Customs to turn over and deliver immediately the said funds to the Philippine Virginia Tobacco Administration (PVTA) as soon as collections are made. LLjur For the proper implementation of the financing aspects of the said law, the following rules and procedures are hereby promulgated for the information and guidance of all concerned: A. Issuance and control of "strip" stamps for Specific Taxes on locally manufactured Virginia-type cigarettes : 1. All stamps sold by the Cash and Disbursement Division during the month to local manufacturers of Virginia-type cigarettes shall be reported to the Chief Accountant within the first five (5) days of the succeeding month for accounting purposes. The report shall be in the present summarized form except that the sale of strip stamps to local manufacturers of Virginia-type cigarettes shall be segregated and specifically identified. 2. The Chief of the Cash and Disbursement Division, who is charged with the responsibility for the issuance and/or sale of strip stamps to local manufacturers of Virginia-type cigarettes shall keep and maintain as usual a daily abstract of stamps (for specific taxes) received and issued, properly identifying the sale and issue of strip stamps for the manufacture of Virginia-type cigarettes. For purposes of coordination, authorized representatives of the PVTA may be permitted to verify the daily abstract of stamps for specific taxes issued, and such other records as may be necessary. 3. The Accounting Division of the Bureau of Internal Revenue shall provide a new account code in the accounting records to identify the 50% share payable to the "Tobacco Fund" for the operation of the PVTA. B. Remittance of 50% of the Specific Taxes on locally manufactured Virginia-type cigarettes collected to finance and support the PVTA operations . LLphil 1. Within the first fifteen (15) days of the succeeding month, the Accounting Office of the Bureau of Internal Revenue, Manila, shall draw a treasury warrant representing the 50% share due to the Philippine Virginia Tobacco Administration (PVTA) on specific taxes collected during the previous month just ended from the manufacturers of Virginia-type cigarettes. 2. Unused strip stamps returned by local manufacturers who have ceased operations shall be refunded their money value by the Accounting Division thru the issuance of treasury warrants, 50% of the amount refunded shall be reflected as a negative adjustment or deduction from the 50% share of the PVTA for the ensuing month. 3. No treasury warrant drawn in favor of the Philippine Virginia Tobacco Administration (PVTA), already countersigned by the Bureau Auditor, shall be released to any authorized representative of the said corporation without the issuance of corresponding official receipt acknowledging the receipt thereof. 4. For the initial release of the amounts due to the PVTA, their 50% share of the proceeds of the sale of the particular strip stamps for the period from June 22 to 30, 1964 shall be segregated and the same remitted to the PVTA as soon as practicable. This information shall be segregated and identified in the summary report of the Cash and Disbursement Division for the month of June, 1964. C. Cost of acquiring and/or re-stamping strip stamps for locally manufactured Virginia-type Cigarettes and expenses incurred for overtime service of B . I . R . personnel . 1. The Philippine Virginia Tobacco Administration shall shoulder 50% of the cost of acquisition and re-stamping (if any) of the strip stamps pertaining to locally manufactured Virginia-type cigarettes. Cost of acquisition includes printing cost, freight, insurance, handling expenses, etc. LLpr 2. In case BIR Revenue Inspectors should find it necessary to render overtime work in cigarette factories working overtime in the production of Virginia-type cigarettes, the Philippine Virginia Tobacco Administration (PVTA) shall shoulder 50% of the overtime pay of the above-mentioned Revenue Inspectors in an amount not to exceed Nine Thousand Pesos (P9,000.00) per annum. 3. The PVTA shall shoulder 50% of the expenses for overtime services of personnel of the accountable Forms Committee in connection with the handling, inventory, and safekeeping of its stock of strip stamps pertaining to locally manufactured Virginia-type cigarettes in an amount not to exceed Six Thousand Pesos (P6,000.00) per annum. 4. Reimbursement to the Bureau of Internal Revenue of the 50% share of the PVTA in the acquisition cost and/or re-stamping of the above-mentioned strip stamps and 50% of the overtime pay of the Bureau personnel mentioned in paragraphs C-2 and C-3 above, shall be effected by the Accounting Division by negative adjustment of the amount due to the PVTA, through journal vouchers. Republic Act No. 4155, took effect upon its approval on June 20, 1964. Implementation of this procedure shall therefore take effect as of June 22, 1964, the first official working day after the approval of R.A. 4155. cdta (SGD.) BENJAMIN N. TABIOS Acting Commissioner of Internal Revenue CONCURRED IN, SUBJECT TO THE APPROVAL OF THE PVTA BOARD OF DIRECTORS: (SGD.) EDUARDO BANANAL General Manager Philippine Virginia Tobacco Administration