HOUSE OF REPRESENTATIVES.

RECEIVED
Date, 15

Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session

1010

REGISTRATION UNIT

BILLS AND inoex SERVICE

HOUSE BILL No.

Introduced by Rep. CARLOS ISAGANI T. ZARATE,

AN ACT
CLASSIFYING SERVICES RENDERED BY TOLLWAY OPERATORS AS VALUE:
ADDED TAX EXEMPT TRANSACTIONS, AMENDING FOR THE PURPOSE,
SECTION 109 (1) OF THE NATIONAL INTERNAL REVENUE CODE, AS
AMENDED BY REPUBLIC ACT NO. 9337, AND FOR OTHER PURPOSES

EXPLANATORY NOTE

This bill secks to amend the National Internal Revenue Code of 197, as amended by Republic Act No. 9377,
by exempting tollway services and the fees tollway operators collect from the value-added tax (VAT).

During the Aquino administration, the Bureau of Internal Revenue (BIR) said the government's move to
collect VA'T on tollway operations will earn P2.3 to P3 billion annually to ostensibly help fund the social
and infrastructure projects.

But the VAT on tollway operations have jacked up all the toll fee rates wherein Class 1 vehicles travelling on
the North Luzon Expressway (NLE-X) from Balintawak to Sta. Ines pay a total of P250 from the previous
rate of P218, Class 2 vehicle: P54 to P626 - Class 3 vehicle: P652 to P750

An ordinary car taking the South Luzon Expressway (SLEX) would pay P128 from Alabang to Calamba from
the previous P86 while the Skyway charges P165 for the elevated potion from Makati to. Toll rates are
charged based on the size of the vehicle which are defined into “classes” therefore vehicles are bigger such as
trucks and buses are charged higher in which the cost is exacerbated with the imposition of the VAT on.
tollway operations.

xxed shoulders of

Imposing the VAT on tollway operations is definitely another burden on the already ov
our people, especially for those whose incomes are barely enough to cover their basic need

In these times of unbridled hikes in the prices of oil, food, other commodities and services, itis the duty of
Congress to work for economic relief to Filipino citizens. ‘The clear-cut removal of VAT on tollway services
in the current internal revenue law is the most logical option for Congress to act on.

Furthermore, in light of the 2011 Supreme Court decision that upheld the imposition of the VAT on tollway
services in the absence of a law prohibiting it, the burden is now on Congress to come to the aid of our
people by removing tollway services from the VAT as a direct form of economic relief. Whatever


government revenue losses incurred will be offset by the increased purchasing power of all Filipino citizens
that will prove better in the long run in making the economy a vibrant and equitable one.

In view of the foregoing, approval of this bill is earnestly sought.

Approved,

es! ek Ra ra

Bayan Muna Party-list *


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session

HOUSE BILLNo.1010

Introduced by Rep. CARLOS ISAGANI T. ZARATE,

AN ACT CLASSIFYING SERVICES RENDERED BY TOLLWAY OPERATORS AS
VALUE-ADDED TAX EXEMPT TRANSACTIONS, AMENDING FOR THE PURPOSE
SECTION 109 (1) OF THE NATIONAL INTERNAL REVENUE CODE, AS
AMENDED BY REPUBLIC ACT NO. 9337, AND FOR OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Section 109 (1) of the National Internal Revenue Code, as amended by
Republic Act No. 9337, is hereby further amended to read as follows:

“SEC. 109, Exempt Transactions. - (1) Subject to the provisions of subsection (2)
hereof, the following transactions shall be exempt from the value-added tax:

#(A) xxx
“@B) xxx

“xxx

“(U) wx

“(V) xxx

“(W) SERVIC

RENDERED BY TOLLWAY OPERATORS.
SECTION 2. Repealing Clause. — All other laws, acts, decrees, executive orders, issuances, and
rules and regulations or parts thereof which are contrary to and inconsistent with any provisions of

this Act are hereby repealed, amended, or modified accordingly.

SECTION 3. Separability Clause. — If any provision of this Act is subsequently declared
unconstitutional, the validity of the remaining provisions hereof shall remain in full force and effect.

SECTION 4. Effectivity Clause. This Act shall take effect immediately after its publication
cither in the Official Gazette or in a newspaper of general circulation in the Philippines.

Approved,