Allowing Sales Tax Credits on Raw Materials Purchase Against Quarterly Sales Taxes Without Taking Into Account Raw Material, Work-In-Process and Finished Goods Inventories
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Allowing Sales Tax Credits on Raw Materials Purchase Against Quarterly Sales Taxes Without Taking Into Account Raw Material, Work-In-Process and Finished Goods Inventories
Executive Order No. 990
October 10, 1984
Case Overview and Summary
Summary of Executive Order No. 990Allowing Sales Tax Credits on Raw Materials Purchase Against Quarterly Sales Taxes
• Manufacturers can credit the specific or percentage tax paid on raw materials, parts, accessories, or other articles purchased for conversion into finished products against the sales tax due on the finished products. (Section 1)
• If the tax paid on raw materials exceeds the sales tax due on finished products, the excess can be credited against the manufacturer's sales tax liability for the succeeding taxable quarter(s). (Section 1)
• The tax amount on raw materials must be indicated separately on the sales invoice. (Section 1)
• If any tax credit is sold, transferred, disposed of, or can no longer be used for manufacturing, it shall be deducted from any unused tax credit or paid as part of the tax due in the following quarter. (Section 1)
• Accumulated tax credits accruing on inventories of raw materials, work-in-process, and finished goods as of the end of the taxable quarter commencing after December 31, 1984, shall be applied in four equal installments against the quarterly sales tax for the four quarters immediately following the effectivity of this Executive Order. (Section 2)
• The Minister of Finance, upon recommendation of the Commissioner of Internal Revenue, shall promulgate rules and regulations prescribing a uniform system of accounting and method of recording sales tax liability of manufacturers and sales tax credits. (Section 3)
• This Order shall take effect on sales for taxable quarters beginning after December 31, 1984. (Section 4)
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Allowing Sales Tax Credits on Raw Materials Purchase Against Quarterly Sales Taxes Without Taking Into Account Raw Material, Work-In-Process and Finished Goods Inventories
Executive Order No. 990
•October 10, 1984
EXECUTIVE ORDER NO. 990 October 10, 1984
ALLOWING SALES TAX CREDITS ON RAW MATERIALS PURCHASE AGAINST QUARTERLY SALES TAXES WITHOUT TAKING INTO ACCOUNT RAW MATERIAL, WORK-IN-PROCESS AND FINISHED GOODS INVENTORIES
WHEREAS, the current economic crisis amounts to a grave emergency which affects the stability of the nation and requires immediate action;
WHEREAS, the issuance of this order is an essential and necessary component of the national economic recovery program formulated to meet and overcome the emergency;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me under Section 290-B of the National Internal Revenue Code, do hereby direct and order that:
Sec. 1. Credits against sales tax due. Any specific or percentage tax paid under Titles IV and V of the National Internal Revenue Code on domestically manufactured, processed or produced, or imported raw material, part, accessory or other article locally purchased or imported by the manufacturer for conversion into or intended to form part of the finished products shall be credited against the sale tax due...
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Amends
n/a
Amended by
n/a
Tags
Executive Issuances
Executive Orders
sales tax credits
raw materials
finished products
manufacturers
tax liability
accounting
recording
inventory
work-in-process
sales invoice
tax paid
tax due
taxable quarter
effective date
EXECUTIVE ORDER NO. 990 October 10, 1984
ALLOWING SALES TAX CREDITS ON RAW MATERIALS PURCHASE AGAINST QUARTERLY SALES TAXES WITHOUT TAKING INTO ACCOUNT RAW MATERIAL, WORK-IN-PROCESS AND FINISHED GOODS INVENTORIES
WHEREAS, the current economic crisis amounts to a grave emergency which affects the stability of the nation and requires immediate action;
WHEREAS, the issuance of this order is an essential and necessary component of the national economic recovery program formulated to meet and overcome the emergency;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me under Section 290-B of the National Internal Revenue Code, do hereby direct and order that:
Sec. 1. Credits against sales tax due. Any specific or percentage tax paid under Titles IV and V of the National Internal Revenue Code on domestically manufactured, processed or produced, or imported raw material, part, accessory or other article locally purchased or imported by the manufacturer for conversion into or intended to form part of the finished products shall be credited against the sale tax due...
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