REPUBLIC ACT No 4103
AN ACT TO AMEND SECTION ONE HUNDRED NINETY OF COMMONWEALTH ACT NUMBERED FOUR HUNDRED SIXTY-SIX, AS AMENDED, OTHERWISE KNOWN AS THE NATIONAL INTERNAL REVENUE CODE.
Section 1. Section one hundred and ninety of Commonwealth Act Numbered Four hundred and sixty-six, as amended, is further amended to read as follows:
"Sec. 190. Compensating tax. On the commodities goods, wares or merchandise purchased or received by persons residing or doing business in the Philippine, there shall be paid a compensating tax on the total value thereof, including freight, postage, insurance, commission and similar charges, equivalent to the percentage taxes imposed under this Title on original transactions effected by merchants, importers, or manufacturers, such tax to be paid before the withdrawal or removal of said commodities, goods, wares or merchandise from the customhouse or the post office, except as follows:
(a) Articles subject to specific taxes under Title IV of this Code and articles to be used by the importer himself in the manufacture or preparation of articles subject to specific...
Details
Amends
n/a
Amended by
n/a
Republic Acts
AN ACT TO AMEND SECTION ONE HUNDRED NINETY OF COMMONWEALTH ACT NUMBERED FOUR HUNDRED SIXTY-SIX
Republic Act No. 4103
Summary of Republic Act No. 4103
Compensating Tax on Imported Goods
- A compensating tax is imposed on the total value of commodities, goods, wares or merchandise purchased or received by persons residing or doing business in the Philippines, including freight, postage, insurance, commission and similar charges. (Section 1)
- The tax rate is equivalent to the percentage taxes imposed on original transactions by merchants, importers, or manufacturers under the National Internal Revenue Code. (Section 1)
- The tax must be paid before the withdrawal or removal of the goods from the customs house or post office. (Section 1)
Exemptions from Compensating Tax
- Articles subject to specific taxes under Title IV of the Code and articles to be used by the importer in manufacturing articles subject to specific taxes. (Section 1(a))
- Goods purchased or received by merchants, importers and manufacturers subject to other taxes, where the importations are to be sold, resold, bartered, exchanged or used in manufacturing articles for sale, barter or exchange. (Section 1(b))
- Articles to be used by the importer in manufacturing articles for consignment abroad. (Section 1(c))
- Articles to be used by the importer as a passenger and/or cargo vessel, including engines and spare parts. (Section 1(d))
- Wearing apparel and articles for personal use purchased in foreign countries by Philippine residents, with value limits based on the duration of their sojourn abroad (P250 for at least 1 week, P500 for at least 2 weeks, P1,000 for at least 1 month). (Section 1(e))
- Personal and household effects purchased in foreign countries and brought into the Philippines by returning residents, with value limits based on the duration of their sojourn abroad (P1,500 for at least 3 months, P2,500 for at least 6 months, P3,000 for at least 1 year). (Section 1(e))
- Additional exemption of P1,000 for books, professional instruments and implements belonging to Filipino professionals, students and grantees of fellowships and scholarships returning from training, studies and/or employment abroad. (Section 1(e))
- Additional exemption of P3,000 for professional instruments and implements related to their field of specialization for returning Filipino Doctors of Medicine and Dentistry and other scientists. (Section 1(e))
- Professional instruments and implements, tools of trade, wearing apparel, domestic animals, and personal and household effects belonging to persons coming to settle for the first time in the Philippines, including citizens who have resided abroad for at least 10 years, for their own use and not for barter, sale or exchange. (Section 1(f))
- Articles used by officials and employees of the Philippine Government assigned abroad and brought on their return due to transfer, resignation, or retirement, with a total acquisition cost not exceeding 20% of their total basic salary received from the Philippine Government during their tour of duty of not more than 4 years. (Section 1(g))
Tax Payment and Penalties
- If an article withdrawn from customs or post office without paying the compensating tax is subsequently used by the importer for other purposes, the corresponding entry should be made in the books of accounts or a written notice sent to the Commissioner of Internal Revenue, and the tax paid within 10 days. (Section 1)
- Failure to pay the tax within 10 days will result in a 25% increase in the tax amount. (Section 1)
- For tax-free articles brought or imported into the Philippines by exempt persons, entities or agencies, which are subsequently sold, transferred or exchanged to non-exempt private persons or entities, the purchasers or recipients shall be considered the importers and liable for the tax. (Section 1)
- The tax due on each article shall constitute a lien on the article itself, superior to all other charges or liens, irrespective of the possessors thereof. (Section 1)
Compensating Tax on Imported Goods
- A compensating tax is imposed on the total value of commodities, goods, wares or merchandise purchased or received by persons residing or doing business in the Philippines, including freight, postage, insurance, commission and similar charges. (Section 1)
- The tax rate is equivalent to the percentage taxes imposed on original transactions by merchants, importers, or manufacturers under the National Internal Revenue Code. (Section 1)
- The tax must be paid before the withdrawal or removal of the goods from the customs house or post office. (Section 1)
Exemptions from Compensating Tax
- Articles subject to specific taxes under Title IV of the Code and articles to be used by the importer in manufacturing articles subject to specific taxes. (Section 1(a))
- Goods purchased or received by merchants, importers and manufacturers subject to other taxes, where the importations are to be sold, resold, bartered, exchanged or used in manufacturing articles for sale, barter or exchange. (Section 1(b))
- Articles to be used by the importer in manufacturing articles for consignment abroad. (Section 1(c))
- Articles to be used by the importer as a passenger and/or cargo vessel, including engines and spare parts. (Section 1(d))
- Wearing apparel and articles for personal use purchased in foreign countries by Philippine residents, with value limits based on the duration of their sojourn abroad (P250 for at least 1 week, P500 for at least 2 weeks, P1,000 for at least 1 month). (Section 1(e))
- Personal and household effects purchased in foreign countries and brought into the Philippines by returning residents, with value limits based on the duration of their sojourn abroad (P1,500 for at least 3 months, P2,500 for at least 6 months, P3,000 for at least 1 year). (Section 1(e))
- Additional exemption of P1,000 for books, professional instruments and implements belonging to Filipino professionals, students and grantees of fellowships and scholarships returning from training, studies and/or employment abroad. (Section 1(e))
- Additional exemption of P3,000 for professional instruments and implements related to their field of specialization for returning Filipino Doctors of Medicine and Dentistry and other scientists. (Section 1(e))
- Professional instruments and implements, tools of trade, wearing apparel, domestic animals, and personal and household effects belonging to persons coming to settle for the first time in the Philippines, including citizens who have resided abroad for at least 10 years, for their own use and not for barter, sale or exchange. (Section 1(f))
- Articles used by officials and employees of the Philippine Government assigned abroad and brought on their return due to transfer, resignation, or retirement, with a total acquisition cost not exceeding 20% of their total basic salary received from the Philippine Government during their tour of duty of not more than 4 years. (Section 1(g))
Tax Payment and Penalties
- If an article withdrawn from customs or post office without paying the compensating tax is subsequently used by the importer for other purposes, the corresponding entry should be made in the books of accounts or a written notice sent to the Commissioner of Internal Revenue, and the tax paid within 10 days. (Section 1)
- Failure to pay the tax within 10 days will result in a 25% increase in the tax amount. (Section 1)
- For tax-free articles brought or imported into the Philippines by exempt persons, entities or agencies, which are subsequently sold, transferred or exchanged to non-exempt private persons or entities, the purchasers or recipients shall be considered the importers and liable for the tax. (Section 1)
- The tax due on each article shall constitute a lien on the article itself, superior to all other charges or liens, irrespective of the possessors thereof. (Section 1)