FOvkTEENTH CONGRESS OF THE 
) 
REPUBLICA)F tHE PHILIPPINES ) 
Third Regular Session 
) 
SENATE 
S. NO. _",,:l.-.o4u.3 ..... C.L" _ 
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S[P 14 P3 :23 
Introduced by Sen. Antonio "Sonny" F. Trillanes IV 
EXPLANATORY NOTE 
It has always been the goal of the government to increase and enhance revenue collection 
and to put a stop to tax fraud and corruption. HoweveJ;, there seems to be an absence of a 
simple yet effective manner of easily verifying and/or authenticating all receipts, 
invoices, permits, licenses, clearances and official papers issued by all government 
agencies and instrumentalities, Government Owned and Controlled Corporations 
(GOCCs) and Local Government Units (LGUs) as well as private businesses, that will 
ensure full accounting and proper docunlentation of all business and commercial 
transactions in the country. 
In this regard, there is a need to establish and implement a simple yet fool-proof way of 
authenticating and verifying the correctness of transactions even by a mere naked eye 
examination to substantially enhance and improve government revenue without 
increasing taxes. 
This bill proposes the use of specialized or watermarked security paper on which all 
receipts, invoices, permits, licenses, clearances and all other official papers and 
documents issued by both the government as well as private entities shall be printed. 
Consequently, the adoption of such legislation will greatly enhance and strengthen tax 
monitoring and collection if the use of security watermarked paper for all receipts and 
other documents will be made a mandatory requirement for all commercial and business 
transactions. 
This Bill is intended to be the counterpart of a similar bill filed by Buhay Party-List 
Representatives Rene M. Velarde, Ma. Carissa Coscolluela and William Irwin Tieng 
before the House of Representative. The version of the said bill as adopted by the 
Committee of Ways and Means of the House Representatives, House Bill No. 6768, is 
now up for third reading before the plenary ofthe said august chamber. 
It should be noted that he National Tax Research Center (NTRC) of the Department of 
Finance (DOF), the government's lead agency when it comes to taxation, has expressed 
its support and full backing for the proposal to use water-marked paper in all receipts and 
similar documents to be issued by state agencies, local government units and even private 
and commercial establishments. The NTRC said this move would enhance and strengthen 
the tax monitoring and collection functions of the government. 
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To quote the NTRC I : 
"It is also expected that the use of watermarked 
paper in all commercial and business transactions could 
minimize if not completezy eliminate the use of falsified 
receipts and other documents. " 
In the light of all the foregoing, the immediate consideration and passage of this bill is 
most earnestly sought. 
~~~-fi_~ 
ANirONIO ':'SONN~-:}: TRILiANES IV 
Senator 
1 Please see the article: "Use afwater-marked paper for receipts backed"; Philippine Star - July 8, 2008; See also: 
Philstar.com - http://www phllstaLcom/Article.aspx?articleld=71550 
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FOURTEENTH CONGRESS OF THE 
) 
REPUBLIC OF THE PIDLIPPINES ) 
Tbird Regular Session 
) 
SENATE 
S. NO. _,_3 4---=....1-=-8_ 
Introduced by Sen. Antonio "Sonny" F. Trillanes IV 
AN ACT 
REQUIRING ALL GOVERNMENT AGENCIES, INSTRUMENTALITIES, 
LOCAL GOVERNMENT UNITS, AND GOVERNMENT OWNED AND! OR 
CONTROLLED 
CORPORATIONS 
(GOCCs) 
AND 
PRIVATE 
ESTABLISHMENTS TO USE SECURITY WATER-MARKED PAPER IN ALL 
RECEIPTS AND INVOICES, PERMITS, LICENSES, CLEARANCES, OFFICIAL 
PAPERS OR DOCUMENTS. 
Be it enacted by the Senate and the House 0/ Representatives 0/ the Philippines in 
Congress assembled: 
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SECTION 1. Sbort Title. - This Act shall be known as the "Document Authentication 
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and Security Act 0/2009". 
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SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to: 
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(a) Enhance tax monitoring and collection; 
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(b) Increase revenue collection; 
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(c) Avoid tax fraud and graft and corruption in the tax collection efforts. 
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SEC. 3. Definition of Terms. - The following definition of terms is hereby 
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adopted: 
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(a) "Receipt" is a written admission or acknb:wledgement of the fact of payment 
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in money or other settlement between seller and buyer.of goods, debtor and creditor, or 
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person rendering services and client or customer printed in accordance with these 
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regulations. 
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(b) "Sales or commercial invoice or delivery receipts" is a written account of 
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goods ore services rendered and the price charged therefore, or a list of goods consigned 
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and the value at which the consignee is to receive them or any other list by whatever 
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name is known which is used in the ordinary course of business evidencing sale and 
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transfer or agreement to sell or transfer goods and service, e.g. purchase orders, delivery 
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receipts, job orders, provisional and temporary receipts, and others; 
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(c) "Security watermarked paper" shall refer to a paper material which bear 
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watermark containing such authorized security feature duly etched and embedded in the 
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paper during its manufacturing process. It is especially designed for the printing of 
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receipts or sales or commercial invoices. 
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SEC. 4. Covered InstitntionslEstablishments. - All government agencies and 
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instrumentalities, including Government-Owned and/or Controlled Corporations, and all 
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Local Government Units and private and commercial establishments, whether 
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corporations, partnerships or sole proprietorships, shall use water-marked paper in all 
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receipts, invoices, forms, permits, licenses, clearances, official papers and documents 
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which they issue to all natural and juridical persons transacting business with them. 
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SEC. 5. Procedure for Printing of Security Watermarked Paper. - The said 
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agencies, GOCCs and LGUs as well as all private establishments shall strictly comply 
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with the implementing rules and regulations (IRR) prescribing the procedures in 
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accordance with which such receipts, invoices, forms, permits, licenses shall be printed, 
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as provided below. The said documents shall be printed on security water-marked paper 
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in accordance with prescribed form and dimensions. 
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SEC. 6. Size and Form of Security Watermarked Paper. - The Department of 
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Finance (DOF), the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) 
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shall prescribe and formulate within a period of two (2) months from the effectivity of 
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this Act, the appropriate uniform dimensions and fon'n of security watermarked paper to 
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be used for all business and commercial transactions in the Philippines. 
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SEC. 7. Covered Forms. -
All receipts, invoices, permits, licenses and 
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clearances and other accountable forms shall, after a period of six (6) months from the 
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effectivity of this Act, all be printed in security water~marked paper: Provided, That any 
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such receipts, invoices, commercial documents, permits, licenses and clearances as well 
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as other accountable forms which remain unused and unconsumed after the lapse of said 
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six -month period may still be used: Provided, further, that appropriate inventory thereof 
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as confirmed and approved by the BIR is conducted and: Provided, finally, That, after a 
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period of six (6) months thereafter, the said unused receipts, invoices, permits, licenses 
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and clearances as well as other accountable forms shall no longer be allowed for use in 
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any transaction in the Philippines. 
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SEC. 8. Penalty. - Any person who fails to comply with the requirements of this 
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Act, including the parties involved in a transaction where the use of security water-
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marked paper is prescribed, as well as government functionaries involved in the 
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monitoring of regulating these transactions, shall be subject to all the appropriate 
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sanctions and penalties provided for in the NationaJ Internal Revenue Code and other 
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pertinent laws, rules and regulations. 
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SEC. 9. Implementing Agency. - The Secretary of the Department of Finance, 
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upon the recommendation of the Commissioner of Internal Revenue and the 
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Commissioner of Customs, shall immediately promulgate and adopt the appropriate 
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implementing rules and regulations (IRR) of this Act. 
Said IRR shall include the 
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identification and setting of the standards upon which the security watermarked paper 
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shall be sourced and supplied and such other details as would be necessary and 
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appropriate for the effective implementation of this Net. 
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SEC. 10. Separability Clause. - If for any reason any provision of this Act is 
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declared unconstitutional or invalid, the remainder or any provisions hereof not affected 
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thereby shall remain in full force and effect. 
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SEC. 11. Repealing Clause. - The provisions of any law, executive orders, 
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presidential decrees or other issuances inconsistent with this Act are hereby repealed or 
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modified accordingly. 
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SEC. 12. Effectivity. - This Act shall take effect fifteen (15) days after its 
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complete publication in the Official Gazette and in at least two (2) newspapers of general 
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circulation. 
Approved, 
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