Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
19th CONGRESS 
First Regular Session 
HOUSE BILL NO.  ____ 
______________________________________________________________________________ 
Introduced by REP. BERNADETTE “DETTE” G. ESCUDERO 
______________________________________________________________________________ 
AN ACT 
EXEMPTING PLEDGE OF PERSONAL PROPERTY COVERING A LOAN OF MONEY NOT 
EXCEEDING TEN THOUSAND PESOS FROM DOCUMENTARY STAMP TAX, 
AMENDING FOR THE PURPOSE SECTION 199 OF THE NATIONAL INTERNAL 
REVENUE CODE OF 1997, AS AMENDED 
EXPLANATORY NOTE 
The Constitutional mandate that taxation shall be just, fair, equitable, and reasonable cannot be 
more profound than when it is taken in the context of today’s looming economic reality. Faced with the 
current situation of the economy, any tax reform effort and revenue scheme should not only be judged 
according to its fiscal adequacy, equity, and administrative feasibility, but more importantly its impact 
on poverty, income distribution, and economic growth. 
Recent amendments to the National Internal Revenue Code as amended, are manifestations that 
the legislature has, in fact, taken this stance. Both Houses of Congress are pushing for legislative 
measures that will provide relief to the taxpayers, recognizing that taxation is not solely about raising 
revenues, but is also to accomplish some desirable non-revenue or social objectives. 
This bill proposes that documents evidencing the receipt of personal property as security for 
the payment of a certain sum of money, i.e. a contract of pledge, where the loaned amount does not 
exceed ten thousand pesos (PhP 10,000.00) be exempt from payment of the documentary stamp tax 
(DST). 
Passage of this bill is justified by the reality that the transactions of this value ordinarily and 
regularly occur among those belonging to the marginalized sectors of our society. Finding themselves 
in dire financial situation, they resort to pledging their personal properties in order to borrow money 
from individuals and/or lending institutions. Because the Tax Code is indifferent on whose liability the 
payment of DST falls, it is often absorbed by the one making the pledge as part of the cost of the loan 
transaction. This is ironic because while the pledge is the one pressed for cash, he still has to cut a share 
of the proceeds of the loan to pay for the DST. 
In this context, the urgent approval of this bill is earnestly recommended. 
BERNADETTE “DETTE” G. ESCUDERO 
July 26, 2022
6:22 pm
2395


Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
19th CONGRESS 
First Regular Session 
HOUSE BILL NO.  ____ 
___________________________________________________________________________ 
Introduced by REP. BERNADETTE “DETTE” G. ESCUDERO 
___________________________________________________________________________ 
AN ACT 
EXEMPTING PLEDGE OF PERSONAL PROPERTY COVERING A LOAN OF MONEY 
NOT EXCEEDING TEN THOUSAND PESOS FROM DOCUMENTARY STAMP TAX, 
AMENDING FOR THE PURPOSE SECTION 199 OF THE NATIONAL INTERNAL 
REVENUE CODE OF 1997, AS AMENDED 
Be it enacted by the Senate and the House of Representatives of the Republic of the Philippines 
in Congress assembled: 
Section 1. Section 199 of the National Internal Revenue Code of 1997, as amended, is hereby 
further amended to read as follows: 
“xxx. 
“SEC. 199. Documents and papers Not Subject to Stamp Tax – 
“xxx. 
(o) DOCUMENTS OR OTHER PAPERS EVIDENCING THE RECEIPT OF
PERSONAL PROPERTY AS SECURITY FOR THE PAYMENT OF ANY
DEFINITE AND CERTAIN SUM OF MONEY WHERE THE PRINCIPAL
AMOUNT LOANED DOES NOT EXCEED TEN THOUSAND PESOS (Php
10,000.00).”
Sec. 2. Implementing Rules and Regulations – The Secretary of Finance shall, upon the 
recommendation of the Commissioner of Internal Revenue, promulgate and publish the necessary rules 
and regulations for the effective implementation of this Act. 
Sec. 3. Repealing Clause – All laws, decrees, executive orders, rules and regulations or parts 
thereof which are inconsistent with this Act, are hereby repealed, amended or modified accordingly. 
Sec. 4. Effectivity – This Act shall take effect fifteen (15) days after its publication in the Official 
Gazette or in any two (2) newspapers of general circulation. 
Approved, 
2395