Regulations Governing the Business of Wholesale Dealers of Articles Subject to a Specific Tax

July 16, 1958 REVENUE REGULATIONS NO. V-62 SUBJECT : Regulations Governing the Business of Wholesale Dealers of Articles Subject to a Specific Tax TO : All Internal Revenue Officers and Others Concerned Pursuant to the provisions of Section 338 in relation to Sections 157, 194(g), (h) & (o) and 182 of the National Internal Revenue Code, as amended, the following regulations which shall govern the business of wholesale dealers of articles subject to a specific tax, are hereby promulgated, and shall be known as Revenue Regulations No. V-62. SECTION 1. Who Are Considered Wholesale Dealers of Articles Subject to a Specific Tax . The following are considered wholesale dealers of articles subject to a specific tax: (a) Any person who for himself or on commission sells or offers for sale cigars, cigarettes and manufactured tobacco in larger quantities than two hundred cigars, eight hundred cigarettes or five kilos of manufactured tobacco at any one time, or who sells or offers the same for the purpose of resale, regardless of quantity. (b) Any person who for himself or on commission sells or offers for sale wines or distilled spirits (other than denatured alcohol), fermented liquors (excluding tuba, basi, tapuy and similar domestic fermented liquors), in larger quantities than five liters at any one time, or who sells or offers the same for the purpose of resale, regardless of quantity. (c) Any person who for himself or on commission sells matches, firecrackers, playing cards, saccharine and coal for the purpose of resale, irrespective of quantity. (d) Any person who for himself or on commission sells manufactured oils and other fuels, bunker fuel oil and diesel fuel oil in quantities larger than five liters at any one time, or for the purpose of resale, irrespective of quantity. SECTION 2. Fixed Business Establishment Subject to Approval of the Commissioner of Internal Revenue. Every person intending to engage in business as a wholesale dealer of articles subject to a specific tax shall file a written application in triplicate addressed to the Commissioner of Internal Revenue, if in Manila, or to the Regional Supervisor if in the province. A sketch of the premises of the fixed business establishments shall be attached thereto. SECTION 3. Issuance of Permit. The Commissioner of Internal Revenue shall, upon approval of the application, cause to be issued to the applicant a permit under administrative schedule "W" with the corresponding paragraph and assessment number. CAaEDH SECTION 4. Privilege Fixed Tax Receipt. Upon the approval of the application and the issuance of the required permit, the successful applicant shall provide himself with the necessary privilege fixed tax receipt. SECTION 5. Wholesale Dealers of Articles Subject to a Specific Tax Required to Keep Separate Books of Accounts. All persons, firms or corporations engaged in the business of selling by wholesale of articles subject to specific tax shall keep a journal and a ledger, or their equivalents: Provided, however, That those whose gross quarterly sales, earnings, receipts, or output do not exceed five thousand pesos shall keep and use a simplified set of Bookkeeping Records duly authorized by the Secretary of Finance wherein all transactions and results of operations are shown and from which all taxes due the Government may readily and accurately be ascertained and determined anytime of the year: Provided, That in the case of corporations, companies, partnerships or persons whose gross quarterly sales, earnings, receipts or output exceed twenty-five thousand pesos, shall have their Books of Accounts audited and examined yearly by Independent Certified Public Accountant and their income tax returns accompanied with certified balance sheets, profit and loss statements, schedules listing income-producing properties and the corresponding incomes therefrom and other relevant matters: And, Provided, Further, That when persons engaged in the business of selling by wholesale articles subject to specific tax are selling or dealing simultaneously with other articles or merchandise not subject to a specific tax, in the same place or establishment, he shall keep a separate record of Books of Accounts for all sales, deliveries, exchanges or barters of articles subject to specific tax, in addition to the books of accounts or records required to be kept under Section 334 of the National Internal Revenue Code in connection therewith. (a) Official register book to be kept by wholesale dealers of articles subject to a specific tax. In addition to the separate books of accounts required herein, a duly authorized wholesale dealer in articles subject to a specific tax shall keep an official register book (BIR Form No. ____) which shall be open at all times to inspection by an internal revenue officer. Said official register book herein required may be secured free of charge from the Commissioner of Internal Revenue, if in Manila and from the city, deputy provincial or provincial treasurers in the provinces, as the case may be. (b) Entries in the fly-leaf of the official register book. Upon delivery of the official register book to the wholesale dealer, the internal revenue officer shall enter on the fly-leaf of the official register book, the date of delivery and the name of the wholesale dealer. A certificate, in triplicate copies, signed by the wholesale dealer, attested to by the internal revenue officer delivering the official register book, to the effect that all the pertinent revenue laws and regulations and the use of the official register book have been fully explained. One copy of the certificate shall be forwarded to the Commissioner of Internal Revenue; another copy shall remain with the city, provincial or deputy provincial treasurer, as the case may be, and the original shall be pasted to the fly-leaf of said official register book. (c) Entries in the official register books. The registered wholesale dealer shall, from day to day, or on such dates when transactions are made, enter in said register book on the "debit" side and in the proper columns provided therefor, the date, the name and address of the seller and the respective quantity of articles purchased. When sales, transfers or issues are effected, the wholesale dealer shall enter in his register book on the "credit" side and in the proper columns provided therefor, the date, name and address of the buyer and the corresponding quantity or articles disposed of. At the end of each month, the wholesale dealer shall strike the balance which shall be carried over as the first entry for the next succeeding month on the "debit" side of the official register book. (d) Submission of monthly transcript sheets. Each wholesale dealer shall, within the first eight (8) days of each month, submit to the Commissioner of Internal Revenue, a true and exact transcript sheet (BIR Form No. __) of all entries made on both the "debit" and "credit" sides of the register book during the preceding month including entries made by any internal revenue officer. At the foot of the transcript sheet, the wholesale dealer shall certify that the entries contained therein are true and correct and are the exact copies of the entries shown in the corresponding official register book. Where there are no entries in the official register book for the month due to temporary suspension of activities and transactions, the monthly transcript sheet shall nevertheless be submitted. (e) Requisition of new register book. When all the pages in the official register book shall have been filled up, the wholesale dealer shall secure a new book from the deputy provincial, provincial or city treasurer, as the case may be, if in the provinces or from the Commissioner of Internal Revenue, if in Manila. The balances of each column in the completed register book shall be carried over to the new register book. (f) Neatness of entries. Entries in the official register book shall be made in a neat and orderly manner and should not contain any erasure or alteration. SECTION 6. Sign to be Displayed. Every wholesale dealer of articles subject to a specific tax shall place and keep on the outside of the building where its business is carried on, a conspicuous sign in plain letters not less than six (6) centimeters high, his name, and the words: "Registered Wholesale Dealer in (name of article subject to specific tax) " with the corresponding schedule, paragraph and assessment number underneath. TIaCHA SECTION 7. Inspection of Records and Articles and Stocktaking by Internal Revenue Officers. A periodical inspection of the records and articles and a stocktaking of the articles kept by the wholesale dealer shall be conducted by an internal revenue officer. Said inspection and/or stocktaking may, however, be made at any time when deemed necessary to protect the revenue. SECTION 8. Registration of Name or Style with Provincial Revenue Agent or Provincial Treasurer. Every person engaged in the business of selling by wholesale articles subject to a specific tax shall, on or before the commencement of his business or occupation register with the provincial revenue agent or with the provincial treasurer, in case no provincial revenue agent is assigned to the province, within ten days after securing his privilege tax receipt, his name or style, place of residence, and the place where such business or occupation is carried on. In case of a firm, the various persons constituting the same shall also be registered. SECTION 9. Persons Subject to Specific Tax to Issue Sales Invoices or Receipts. All wholesale dealers of articles subject to a specific tax, shall, for each sale or transfer of merchandise or articles valued at two pesos or more, prepare and issue sales of commercial invoices or receipts serially numbered in duplicate, showing, among other things, their names, or styles, if any, and business address: Provided, That in case of sales, receipts or transfers in the amount of fifty pesos or more, the invoices or receipts shall further show the name, or style, if any, and business address of the purchaser or customer. The original of each sales invoice or receipts shall be issued to the purchaser or customer, who, if engaged in any taxable business, shall keep and preserve the same in his place of business for a period of five years, from the date of the invoice or receipt, the duplicate to be kept and preserved by the persons subject to tax, also in his place of business for the same period: Provided, That persons subject to specific tax, whose gross sales, earnings or receipts during the last preceding year exceed twenty thousand pesos, shall, for each sale or transaction, issue an invoice or receipt, irrespective of the value of the articles sold. SECTION 10. Date of Effectivity. These regulations shall take effect upon promulgation in the Official Gazette. (SGD.) JAIME HERNANDEZ Secretary of Finance RECOMMENDED BY: (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue