- PRES!
> EGEINED
Re

IG 2016
Republic of the Philippines pat
HOUSE OF REPRESENTATIVES ei Th awe
Quezon City i e
BY:
SEVENTEENTH CONGRESS RECISTRATION UNIT
First Regular Session BULLS AND INDEX SERVICE

HOUSE BILL No. 2523

Introduced by REP. JULIETTE T. UY

EXPLANATORY NOTE

‘This bill aims to correct the current situation of local taxation that is detrimental to local
governments with regard to the treatment of the sifus of the tax.

‘The current law on local taxation as stipulated in the Local Government Code already recognizes
and imposes the situs rule on taxation but further modifications are needed to attain fairness in
the area of tax sharing between and among local government units where the principal place of
business, branch or sales outlet, factory, project office, plant or plantation is located.

A one hundred percent share of all sales or transactions to Local Government Units (LGUs) is,
proposed so long as such the sales or transactions occur within the area of the LGU concerned.

‘This measure shall essentially expunge the present thitty (30) percent share of the LGU where
the principal place of business is located

‘This bill is anchored on a progressively equitable distribution of revenues; based on the fact that
‘most principal places of businesses are located in the highly urbanized cities of our nation, such

as those in Metro Manila.

This measure is within the constitutional mandate of making our LGUs autonomous and self-
sustaining government bodies.

In view of the foregoing, the immediate passage of this Bill is earnestly sought.

Approve,

é

REP. JULIEZTE T. UY
2nd Distrig, Misamis Oriental


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session

2529

HOUSE BILL No.

Introduced by REP. JULIETTE T. UY

AN ACT
RATIONALIZING LOCAL TAXATION AMENDING FOR THE PURPOSE
SECTION 150, CHAPTER 1, TITLE ONE, BOOK II OF REPUBLIC ACT NO. 7160,
AS AMENDED, OTHERWISE KNOWN AS THE LOCAL GOVERNMENT CODE

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

Section 1, Section 150, Chapter 1, Title One, Book II of Republic Act No. 7160, as amended, is
hereby further amended to read as follows:

"SECTION 150. Situs of the Tax. - (a) For purposes of collection of the
taxes under Section 143 of this Code, manufacturers, assemblers, repackers,
brewers, distillers, rectifiers and compounders of liquor, distilled spirits and
wines, millers, producers, exporters, wholesalers, distributors, dealers,
contractors, banks and other financial institutions, and other businesses,
maintaining or operating branch or sales outlet, FACTORY, PROJECT
OFFICE, PLANT OR PLANTATION elsewhere shall record the sale in
the branch or sales outlet, FACTORY,PROJECT OFFICE, PLANT OR
PLANTATION making the sale or transaction, and the tax thereon shall
accrue and shall be paid to the municipality where such branch or sales
outlet, FACTORY, PROJECT OFFICE, PLANT OR PLANTATION
is located. In cases where there is no such branch or sales outlet,
FACTORY, PROJECT OFFICE, PLANT OR PLANTATION in the
city or municipality where the sale or transaction is made, the sale shall be
duly recorded in the principal office and the taxes due shall accrue and shall
be paid to such city or municipality

[(b) The following sales allocation shall apply to manufacturers, assemblers,
contractors, producers, and exporters with factories, project offices, plants,
and plantations in the pursuit of their business:

(4) Thiety percent (30%) of all sales recorded in the principal office shall be
taxable by the city or municipality where the principal office is located; and


() Seventy percent (70%) of all sales recorded in the principal office shall be
taxable by the city or municipality where the factory, project office, plant, or
plantation is located]

[©] (B)_ In case of a plantation located at a place other than the place
where the factory is located, [said seventy percent (70%)] THE SALE OR
‘TRANSACTION mentioned [in subparagraph (b) of subsection (2)] above
shall be divided as follows:

(1) Sixty percent (60%) to the city or municipality where the factory is
located; and

(2) Forty percent (40%) to the city or municipality where the plantation is
located.

[@] (© In case where a manufacturer, assembler, producer, exporter or
contractor has two (2) or more factories, project offices, plants, or
plantations located in different localities, the [seventy pe
OR TRANSACTION mentioned [in subparagraph (b) of subsection (2)]
above shall be prorated among the localities where the factories, project
offices, plants, and plantations are located in proportion to their respective
volume or production during the period for which the tax is due.

[©] @) The foregoing [sales allocation] shall be applied irrespective of
whether or not sales are made in the locality where the factory, project
office, plant or plantation is located."

Section 2. The Secretaries of the Department of Finance, the Department of Budget and
Management and the Department of Interior and Local Government, and the Presidents of the
different Ligas shall promulgate the required rules and regulations for the speedy and effective
implementation of this Act.

Section 3. If any provision or part hereof is held invalid or unconstitutional, the remainder of
the law or the provision not otherwise affected shall remain valid and subsisting.

Section 4. All laws, presidential decrees, executive orders, proclamations, department orders,
memorandum circulars, administrative rules and regulations which ate inconsistent with the

provisions of this Act are hereby amended, modified, superseded ot repealed accordingly.

Section 5. This Act shall take effect fifteen (15) days from its publication in the Official Gazette
or at least two newspapers of national circulation.

Approved,