Sales Tax Regulations

June 16, 1948 REVENUE REGULATIONS NO. V-3 SUBJECT : Sales Tax Regulations TO : All Internal Revenue Officers and Others Concerned SECTION 1. Scope. Pursuant to the authority granted in sections 183 and 338 of Commonwealth Act No. 466, otherwise known as the National Internal Revenue Code, the following regulations relative to the assessment and collection of the sales tax on imported, manufactured and locally produced articles are hereby promulgated, and shall be known as Revenue Regulations No. V-3 or "Sales Tax Regulations". HTDAac SECTION 2. Payment of Sales Tax on Imported, Manufactured and Locally Produced Articles. (A) Imported articles. In the case of imported articles, the percentage taxes established in sections 184, 185 and 186 of the National Internal Revenue Code shall be paid in advance by the importer prior to the release of such articles from customs' custody. The percentage taxes shall be based on the total value of the imported articles at the time they are received by the importer, including freight, postage, insurance, commission, customs' duty, and all similar charges. (Sec. 183 (B), National Internal Revenue Code, as amended by section 1, Republic Act No. 253.) Where a shipment of goods consists of articles taxable under different rates, the expenses, such as freight and insurance, shall be apportioned according to the value of the articles The percentage taxes abovementioned shall be paid in advance to the Commissioner of Customs in Manila, or to the Collector of Customs of the port of entry where the goods are to be unloaded. The Collector of Internal Revenue is hereby authorized to detail in the Bureau of Customs officers and employees of the Bureau of Internal Revenue for the purpose of cooperating with the Commissioner of Customs and his subordinates in the enforcement of the provisions of these regulations. (3) Locally manufactured articles. In the case of articles locally manufactured or produced, the percentage taxes established in sections 184, 185 and 186 of the National Internal Revenue Code shall be paid in advance by the manufacturer or producer prior to the removal of such articles from the warehouse. The percentage taxes shall be paid on the total value of the articles prior to the removal thereof from the manufacturer's or producer's warehouse. (Sec. 183 (B), National Internal Revenue Code, as amended by section 1, Republic Act No. 253.) Where articles are imported for the purpose of being used by the importer in the manufacture of other articles, the manufacturer shall pay the percentage tax on the imported articles before removal thereof from the customhouse. The percentage taxes abovementioned shall be paid in advance to the Collector of Internal Revenue, or to the provincial and city treasurers and their deputies. In case it is impracticable for a manufacturer or producer to pay the percentage taxes as herein prescribed, the Collector of Internal Revenue may authorize such manufacturer or producer to pay in advance an amount sufficient to cover the estimated percentage taxes due for one month, provided that such manufacturer or producer keeps the books of accounts and records prescribed by law and Revenue Regulations No. V-1. In such case, payment shall be made not later than the 5th day of each month. SECTION 3. Warehouses, Defined. The warehouse referred to in the preceding section refers not only to the warehouse erected or established by the manufacturer or producer, but also to any place of manufacture or production where articles locally manufactured or produced are kept for storage. SECTION 4. Manner of Payment and Accounting of Advance Sales Tax. In the case of imported articles, the advance sales tax shall be collected from the importer by the Commissioner of Customs on official receipts in the same manner as compensating taxes are collected upon filing by the importer of a declaration on B.I.R. Form No. 25.22, which shall be accomplished at least in triplicate, one copy of which shall be sent to the Collector of Internal Revenue. The advance sales tax shall be taken up under account classification H-7, and properly classified as "advance sales tax" in the statements of collections submitted to the Bureau of Internal Revenue. Necessary notation and cross-reference shall be made on the corresponding coupon of the C-14 privilege tax-receipt held by the importer. DcCASI In all cases, the following form shall be accomplished by importers: B.I.R. Form No. 25.22. IMPORTER'S DECLARATION FOR ADVANCE PAYMENT OF SALES TAX AS PROVIDED IN SEC. 183 (B), N.I.R.C. ________________ Date I hereby certify that the total value of the articles imported by me at the time they are received, including freight, postage, insurance, commission, customs' duty and similar charges, subject to the sales tax which shall be paid in advance is as follows: Kind of Where Imported Value Plus Total Rate Amount Articles Date and Number Charges Value of Due of Import Entry Tax ________ _____________ ______ _______ _______ ______ _______ ________ _____________ ______ _______ _______ ______ _______ ________ _____________ ______ _______ _______ ______ _______ ________ _____________ ______ _______ _______ ______ _______ ___________________ Importer's signature TO BE FILLED IN BY COLLECTING OFFICER The advance sales tax on the above articles has been paid on official receipt No. _________ dated ____________, 19____ which has been duly noted on internal revenue privilege tax-receipt No. C-14 ________ for 194___. ______________________ Collecting Officer Manufacturers or producers of articles subject to advance sales tax shall accomplish the declaration on B.I.R. Form No. 25.21 and pay the corresponding sales tax to the Collector of Internal Revenue, or to the local deputy provincial or city treasurer, who will issue a miscellaneous tax-receipt or official tax-receipt therefor. The advance sales tax shall be taken up by the collecting officer under the proper sub-classification of Schedule C-14 of the report (B.I.R. 12.01), and under the account classification H-7 of the account current. Proper notation of the amount paid shall be made on the corresponding coupon of the C-14 privilege tax-receipt held by the manufacturer. The manufacturer's or producer's declaration shall be substantially in the following form: B.I.R. Form No. 25.21 MANUFACTURER'S OR PRODUCER'S DECLARATION FOR ADVANCE PAYMENT OF SALES TAX AS PROVIDED IN SECTION 183 (B), NATIONAL INTERNAL REVENUE CODE ________________ Date I hereby certify that the total value of the articles manufactured by me, subject to the sales tax which shall be paid in advance is as follows: Kind of When Date of Total Cost of Taxable Advance Articles manufactured Removal Value tax-paid Value Sales Tax Materials Due ________ _____________ ______ _______ _______ ______ _______ ________ _____________ ______ _______ _______ ______ _______ ________ _____________ ______ _______ _______ ______ _______ ________ _____________ ______ _______ _______ ______ _______ _________________________ Manufacturer's or producer's signature TO BE FILLED IN BY COLLECTING OFFICER The advance sales tax on the above articles has been paid on Official Receipt No. _______ dated ____________ which has been duly noted on internal revenue privilege tax-receipt No. C-14 _________ for 194___. ______________________ Collecting Officer SECTION 5. Quarterly Return and Payment of Sales Tax. It shall be the duty of every importer, manufacturer or producer, within twenty days after the end of every calendar quarter, to make a true and complete return of the amount of the gross sales during the preceding calendar quarter and pay the tax due thereon. (Sec. 183 (A), National Internal Revenue Code, as amended by Rep. Act No. 253.) The amount paid in advance by importers, manufacturers and producers shall be credited against the percentage taxes due on their sales for each calendar quarter. (Sec. 183, id. ) TCIEcH Where an importer, manufacturer or producer retires from business, it shall be his duty to notify the nearest internal-revenue officer thereof within ten days after closing his business and file his return or declaration and pay the tax due thereon. SECTION 6. Invoices, Receipts, and Other Supporting Papers and Documents. A file of the invoices and other supporting papers covering local purchases and another file for the bills of lading and other records covering imported and locally manufactured or produced articles shall be kept and preserved in the manner prescribed in Revenue Regulations No. V-1. Invoices, receipts and other supporting papers and documents covering sales of imported and locally manufactured or produced articles shall likewise be filed separately from invoices covering sales of locally purchased goods. SECTION 7. Penal Provisions. If the percentage tax is not paid as prescribed in section 183 of the Revenue Code, the amount of the tax shall be increased by twenty-five per centum, the increment to be a part of the tax. In case of willful neglect to file the return within the time prescribed, or in case a false or fraudulent return is willfully made, there shall be added to the tax or to the deficiency tax, in case any payment has been made on the basis of such return before the discovery of the falsity or fraud, a surcharge of fifty per centum of its amount. The amount so added to any tax shall be collected at the same time and in the same manner and as part of the tax, unless the tax has been paid before the discovery of the falsity or fraud, in which case the amount so added shall be collected in the same manner as the tax. (Sec. 183 (A), National Internal Revenue Code, as amended by section 1, Republic Act No. 253.) Any person who shall fail or neglect to make a return or pay the percentage taxes prescribed in sections 184, 185 and 186 of the National Internal Revenue Code within the time prescribed in section 183 of the same Code shall be punished by a fine in a sum not exceeding one thousand pesos or by imprisonment for a term not exceeding one year, or both. Any such person who shall make a false or fraudulent return shall, besides being liable to the surcharge prescribed in section 183 of the Revenue Code, be punished by a fine of not less than P500 nor more than P10,000 or by imprisonment of not less than 6 months but not more than 6 years, or both. (Sec. 209, National Internal Revenue Code.) Any person who shall violate any provision of these regulations, for which violation the National Internal Revenue Code or any other law does not provide any specific penalty, shall be penalized under section 352 of the aforesaid Code by a fine of not more than P300.00 or by imprisonment of not more than six months, or both. SECTION 8. Date of Effectivity. These regulations shall take effect on July 1, 1948. EHTISC MIGUEL CUADERNO, SR. Secretary of Finance By: CRISPIN LLAMADO Undersecretary of Finance RECOMMENDED BY: BIBIANO L. MEER Collector of Internal Revenue