Creation, Modification and Dropping of Alphanumeric Tax Code (ATC) of Selected Revenue Source under the Tax Forms Enhancement Program

January 16, 2006 REVENUE MEMORANDUM ORDER NO. 03-06 SUBJECT : Creation, Modification and Dropping of Alphanumeric Tax Code (ATC) of Selected Revenue Source under the Tax Forms Enhancement Program TO : All Collection Agents, Revenue District Officers and Other Internal Revenue Officers Concerned I. Objective : To facilitate the proper identification and monitoring of tax payments pursuant to Republic Act No. 9337, as implemented by Revenue Regulation No. 16-2005 dated September 1, 2005, the following ATCs are hereby created, modified and dropped. II. The following ATCs are hereby created : KIND OF TAX ISSUANCE/ BIR TAX ATC LEGAL BASIS/ FORM RATES REASONS NO. Percentage Tax Tax on Banks and Non-Bank Financial Intermediaries Performing Quasi- Banking Functions On interest, commissions and RR 16-2005 2551M discounts from lending activities as well as income from financial leasing, on the basis of remaining maturities of instruments from which such receipts are derived: Maturity period is five (5) years or less 5% PT105 On net trading gains within the RR 16-2005 2551M 7% PT104 taxable year on foreign currency debt securities, derivatives and other financial instruments Tax on Other Non-Bank Financial Intermediaries not Performing Quasi- Banking Functions On interest, commissions and RR 16-2005 2551M discounts from lending activities as well as income from financial leasing, on the basis of remaining maturities of instrument from which such receipts are derived: Maturity period is five (5) years or less 5% PT113 Maturity period is more than five (5) 1% PT114 years On all other items treated as gross 5% PT115 income Tax on Banks and Non-Bank Financial Intermediaries Performing Quasi- Banking Functions: On net trading gains within the RR 16-2005 1600 7% WB104 taxable year on foreign currency debt securities, derivatives and other similar financial instruments Tax on Other Non-Bank Financial Intermediaries not Performing Quasi- Banking Functions On interest, commissions and RR 16-2005 1600 discounts from lending activities as well as income from financial leasing, on the basis of the remaining maturities of instruments from which such receipts are derived: Maturity period is five (5) years or less 5% WB108 Maturity period is more than five (5) 1% WB109 years On all other items treated as gross 5% WB110 income Person exempt from VAT under RR 14-2003 1600 3% WB082 Sec. 109v (creditable) Private Withholding Agents Person exempt from VAT under RR 14-2003 1600 3% WB084 Sec. 109v (final) VALUE-ADDED TAX Government public works contractors subject to 5% For Monitoring 1600 5% WV030 III. The following ATCs are hereby modified : See Attachments IV. The following ATCs are hereby dropped : KIND OF TAX ISSUANCE/ BIR TAX ATC LEGAL BASIS/ FORM RATES REASONS NO. Percentage Tax Tax on Finance Companies On interest, discounts and other RR 16-2005 2551M 5% PT111 items of gross income paid to finance companies and other financial intermediaries not performing quasi- banking function On interest, commissions and RR 16-2005 2551M 5%, 3%, PT112 discounts paid from their loan 1% & 0% transactions from finance companies as well as financial leasing based on the remaining maturities of the instruments Tax on Banks and Non-Bank Financial Intermediaries On interest, commissions and RR 16-2005 1600 discounts paid to banks and non- bank financial intermediaries arising out of lending activities as well as financial leasing, on basis of the remaining maturities of instrument: Medium term maturity (over 2 3% WB302 years to 4 years) Over 7 years 0% WB304 Tax on Finance Companies On interest, discounts and other RR 16-2005 1600 5% WB111 items of gross income paid to finance companies and other financial intermediaries not performing quasi- banking functions V. Repealing clause : This Revenue Memorandum Order revises portions of all other issuances inconsistent herewith. VI. Effectivity : This Revenue Memorandum Order shall take effect immediately. (SGD.) JOSE MARIO C. BUAG Commissioner of Internal Revenue ATTACHMENT