<>

an >

7, ¢
* ie
SS

* oo

Republic of the Philippines
‘ House of Representatives
Quezon City

Seventeenth Congress
First Regular Session

HOUSE BILL NO. 4688

.

Introduced by Representative Joey Sarte Salceda

EXPLANATORY NOTE

This proposed Tax Reform for Acceleration and Inclusion (short-named
TRAIN) Bill envisions to create a tax system that is simpler, fairer, and more
efficient, characterized by low rates and a broad base that promotes
investment, job creation and poverty reduction. This is in line with President
Rodrigo Duterte’s commitment to President Rodrigo Duterte’s promise and
commitment to“Tunay na Pagbabago” or real positive change for the Filipino
people, that includes, among others, more inclusive growth manifested by a
comfortable life for all, improved public services, more and better jobs, and
more money in the people's pockets; and safe, healthy, and peaceful
communities.

All these can significantly reduce poverty incidence from 26 to 17 percent by
2022, or lifting some 10 million Filipinos out of poverty, and achieving upper
middle income country status by 2022. Sustaining real positive change for
one generation can eradicate extreme poverty and allow our country to join
the ranks of advanced nations by 2040. This is a dream that all Filipinos
share and aspire for.

To realize these aspirations, the Duterte Administration recognizes the need
to sustain high growth of at least 7 percent every year for one generation,
shift the source of growth from consumption to investment, and heavily
invest in our people through improved social services, such as public health
and education systems, and in better infrastructure to improve connectivity
and raise productivity. These necessary investments require an additional
one trillion pesos annually over the long-term, of which some 600 billion
pesos (3% of GDP} is targeted by 2019. To sustainably finance these
investments, a tax reform program for acceleration and inclusion is
proposed.

This Bill will be complemented by major tax administration reforms in both
the Bureau of Internal Revenue and Bureau of Customs, proposed
separately under the Tax Administration Reform Act. This is in addition to
continuing budget reforms that are being pursued to promote spending
transparency and efficiency,

The tax reform program consists of several packages, with each package
balancing trade-offs (e.g., lowering of some tax rates while broadening the
base of other taxes) and helping to ensure timely enactment. The first
package, which is the subject of this bill, seeks to lower personal income


taxes while broadening the VAT base and adjusting excise taxes. Relaxation
of bank secrecy and an absolute tax amnesty are also being proposed to
accompany this package.

The key features of this bill are the following:

1. Adjustment of the personal income tax brackets to correct for
“income bracket creeping”, reduction of the maximum rate to 25%
over time, except for the highest income earners to maintain
progressivity, and shift to a modified gross system to simplify the
PIT system.

2. Revenue losses from the PIT reform will be offset by i) expanding
the VAT base by limiting exemptions to raw food and other
necessities (e.g., education and health), ii) increasing excise tax
rates on all petroleum products to address negative externalities
brought about by congestion and pollution, and iii) restructuring
and increasing the excise tax on automobiles. These increases in
various excise taxes will be indexed to inflation as well to preserve
the excise burden.

3. To mitigate the impact of the tax increases on the poor and low
income households, 25% of incremental revenues from increases in
excise taxes is earmarked for highly targeted subsidies for three (3)
years is proposed to fully protect the poorest 50% of households
and partially protect the working class. Moreover, there is
mechanism to link adjustments in petroleum taxes to Dubai crude
price set at $85/barrel.

Effective partnership between Congress and the Executive has always been
crucial in moving the country's development agenda forward. Today, a
window of opportunity exists to take the country to the next level of
development. This window of opportunity, characterized by strong
macroeconomic fundamentals, global recognition for the success of the
country, and a popular new government, provides the necessary condition to
realize the President's vision for the country. This bill is the author's humble
contribution to this call to become partners for real positive change.

Given all these, the timely passage of this bill is earnestly sought.

REP,AJJOEY SARTE SALCEDA


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Seventeenth Congress
First Regular Session

House Bill No. 4688

Introduced by Representative Joey Sarte Salceda

AN ACT AMENDING SECTIONS 22, 24, 31, 32, 34, 35, 79,106, 107,
108, 109, 110, 148 AND TITLE VI OF REPUBLIC ACT NO. 8424
OTHERWISE KNOWN AS “THE NATIONAL INTERNAL REVENUE.
CODE OF 1997”, AS AMENDED, AND FOR OTHER PURPOSES.

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

SECTION 1.Title, This Act shall be known as the “Tax Reform for
Acceleration and Inclusion” or its acronym TRAIN.

SEC. 2. Declaration of Policy.lt is hereby declared the policy of the State:

1. To enhance the progressivity of the tax system through the
rationalization of the Philippine internal revenue tax system, thereby
promoting sustainable economic growth;

2. To provide, as much as possible, an equitable relief to a greater
number of taxpayers in order to improve levels of disposable income
and increase economic activity; and

3. To ensure that the government is able to provide for the needs of those
under its jurisdiction and care.

SEC.3. Section 22 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 22. Definitions. - When used in this Title:

XXX XXX XXX

[(GG) The term “statutory minimum wage” shall refer to the rate
fixed by the Regional Tripartite Wage and Productivity Board, as
defined by the Bureau of Labor and Employment Statistics (BLES) of
the Department of Labor and Employment (DOLE).”

w


(HH) The term “minimum wage earner’ shall refer to a worker in
the private sector paid the statutory minimum wage, or to an
employee in the public sector with compensation income of not more
than the statutory minimum wage in the non-agricultural sector
where he/she is assigned.”]

SEC. 4. Section 24 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 24. Income Tax Rates. -

(A) Rates of Income Tax on Individual Citizen and Individual
Resident Alien of the Philippines. -

(1) An income tax is hereby imposed:

(a) On the taxable income defined in Section 31 of this Code,
other than income subject to tax under Subsections (B), (C) and
(D) of this Section, derived for each taxable year from all sources
within and without the Philippines by every individual citizen of
the Philippines residing therein;

(b)On the taxable income defined in Section 31 of this Code,
other than income subject to tax under Subsections (B), (C) and
D) of this Section, derived for each taxable year from all sources
within the Philippines by an individual citizen of the Philippines
who is residing outside of the Philippines including overseas
contract workers referred to in Subsection (C) of Section 23
hereof; and

(c)On the taxable income defined in Section 31 of this Code,
other than income subject to tax under Subsections (B), (C) and
(D) of this Section, derived for each taxable year from all sources
within the Philippines by an individual alien who is a resident of
the Philippines.

(2) Rates of Tax on Taxable Income of Individuals. - The tax shall be
computed in accordance with and at the rates established in the
following schedule:

[Not over P10,000 ..... ws 5%

Over P10,000 but not over P30,000.... -P500 + 10% of the

excess over P10,000

.-P2,500 + 15% of the
excess overP30,000

Over P30,000 but not over P70,000 ......

Over P70,000 but not over P140,000..... P8,500 + 20% of the

4


excess overP70,000

Over P140,000 but not over P250,000... ...P22,500 +25% of the

excess overP140,000

Over P250,000 but not over P500,000... ...P50,000 +30% of the

excess overP250,000

Over P500,000.... .+.-P125,000+32%of the

excess overP500,000)

TAX SCHEDULE 2018

Not over P250,000 .. 0%
Over P250,000 but not over P400,000 ..... +++ 20% of the
excess over P250,000

Over P400,000 but not over P800,000 ..... .--P30,000 + 25% of the

excess over P400,000

Over P800,000 but not over P2,000,000... .P130,000 + 30% of the

excess over P800,000

Over P2,000,000 but not over P5,000,000 ........P490,000 + 32% of the
excess over P2,000,000

Over P5,000,000 ... -P1,450,000 + 35% of the

excess over P5,000,000

TAX SCHEDULE 2019

Not over P250,000 ..... -- O%
Over P250,000 but not over P400,000 .......... ...15% of the excess
over P250,000

Over P400,000 but not over P800,000 ..... .-P22,500 + 20% of the

excess over P400,000
Over P800,000 but not over P2,000,000 ...........P102,500 + 25% of the
excess over P800,000

Over P2,000,000 but not over P5,000,000 ........P402,500 + 30% of the
excess over P2,000,000

Over P5,000,000 ..

1,302,500 + 35% of the
excess over P5,000,000


PROVIDED, THAT AFTER 2019, THE TAXABLE INCOME LEVELS IN
THE ABOVE SCHEDULES SHALL BE ADJUSTED ONCE EVERY FIVE
(5) YEARS THROUGH RULES AND REGULATIONS ISSUED BY THE
SECRETARY OF FINANCE, UPON RECOMMENDATION OF THE
COMMISSIONER, AFTER CONSIDERING AMONG OTHERS, THE
EFFECT ON THE SAME OF THE FIVE-YEAR CUMULATIVE
INFLATION RATE.

For married individuals, the husband and wife, subject to the
provision of Section 51 (D) hereof, shall compute separately their
individual income tax based on their respective total taxable income:
Provided, That if any income cannot be definitely attributed to or
identified as income exclusively earned or realized by either of the
spouses, the same shall be divided equally between the spouses for
the purpose of determining their respective taxable income.

[Provided, That minimum wage earners as defined in Section 22 (HH)
of this Code shall be exempt from the payment of income tax on their
taxable income: Provided, further, That the holiday pay, overtime pay,
night shift differential pay and hazard pay received by such minimum
wage earners shall likewise be exempt from income tax.]

(B)Rate of Tax on Certain Passive Income: -

(1) Interests, Royalties, Prizes and Other Winnings. ~ A final tax at
the rate of twenty percent (20%) is hereby imposed upon the
amount of interest from any currency bank deposit and yield or
any other monetary benefit from deposit substitutes and from trust
funds and similar arrangements; royalties, except on books, as well
as other literary works and musical compositions, which shall be
imposed a final tax of ten percent (10%); prizes (except prizes
amounting to Ten thousand pesos (P10,000) or less which shall be
subject to tax under Subsection (A) of section 24; and other
winnings |(except Philippine Charity Sweepstakes and Lotto
winnings)] derived from sources within the Philippines: Provided,
however, That interest income received by an individual taxpayer
(except a nonresident individual) from a depository bank under the
expanded foreign currency deposit system shall be subject to a
final income tax at the rate of seven and on-half percent (7 4%) of
such interest income: Provided, further, That interest income from
long-term deposit or investment in the form of savings, common or
individual trust funds, deposit substitutes, investment
management accounts and other investments evidenced by
certificates in such form prescribed by the Bangko Sentral ng
Pilipinas (BSP) shall be exempt from the tax imposed under this
Subsection: Provided, finally, That should the holder of the
certificate pre-terminate the deposit or investment before the fifth
(5th) year, a final tax shall be imposed on the entire income and
shall be deducted and withheld by the depository bank from the


proceeds of the long-term deposit or investment certificate based
on the remaining maturity thereof:

XXX XXX XXX

SEC. 5. Section 25 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 25. Tax on Nonresident Alien Individual. —

(A) Nonresident Alien Engaged in Trade or Business Within the
Philippines. —

XXX XXX XXX

(B) Nonresident Alien Not Engaged in Trade or Business Within
the Philippines.

XXX XXX XXX

[(C) Alien Individual Employed by Regional or Area Headquarters
and Regional Operating Headquarters of Multinational
Companies.- There shall be levied, collected and paid for each taxable
year upon the gross income received by every alien individual
employed by regional or area headquarters and regional operating
headquarters established in the Philippines by multinational
companies as salaries, wages, annuities, compensation, remuneration
and other emoluments, such as honoraria and allowances, from such
regional or area headquarters and regional operating headquarters, a
tax equal to fifteen percent (15%) of such gross income: Provided,
however, That the same tax treatment shall apply to Filipinos
employed and occupying the same position as those of aliens
employed by these multinational companies. For purposes of this
Chapter, the term ‘multinational company’ means a foreign firm or
entity engaged in international trade with affiliates or subsidiaries or
branch offices in the Asia-Pacific Region and other foreign markets. |

|(D) Alien Individual Employed by Offshore Banking Units. - There
shall be levied, collected and paid for each taxable year upon the gross
income received by every alien individual employed by offshore
banking units established in the Philippines as salaries, wages,
annuities, compensation, remuneration and other emoluments, such
as honoraria and allowances, from such off-shore banking units, a tax
equal to fifteen percent (15%) of such gross income: Provided,
however, That the same tax treatment shall apply to Filipinos
employed and occupying the same positions as those of aliens
employed by these offshore banking units. |


(er Alien Individual Employed by Petroleum Service Contractor
and Subcontractor. - An Alien individual who is a permanent
resident of a foreign country but who is employed and assigned in the
Philippines by a foreign service contractor or by a foreign service
subcontractor engaged in petroleum operations in the Philippines
shall be liable to a tax of fifteen percent (15%) of the salaries, wages,
annuities, compensation, remuneration and other emoluments, such
as honoraria and allowances, received from such contractor or
subcontractor: Provided, however, That the same tax treatment shall
apply to a Filipino employed and occupying the same position as an
alien employed by petroleum service contractor and subcontractor.]

[Any income earned from all other sources within the Philippines by
the alien employees referred to under Subsections (C), (D) and (E)
hereof shall be subject to the pertinent income tax, as the case may
be, imposed under this Code.]

SEC. 6. Section 31 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 31.Taxable Income, Defined. - The term ‘taxable income’
means the pertinent items of gross income specified in this Code less
[the] deductions [and/or personal and additional exemptions], if any,
authorized for such types of income by this Code [or other special
laws}.

SEC. 7. Section 32(B)(7) of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 32. Gross Income. -
XXX XXX XXX
(B) Exclusions from Gross Income.- The following items shall not be
included in gross income and shall be exempt from taxation under
this Title:
XXX XKK XK
(7) Miscellaneous Items. —
XXX XXX Kx
[(e) 13th Month Pay and Other Benefits. - Gross benefits received
by officials and employees of public and private entities:
Provided, however, That the total exclusion made under this

subparagraph shall not exceed Eighty-two thousand pesos
(P82,000) which shall cover:|


[(i) Benefits received by officials and employees of the
national and local government pursuant to Republic Act
No. 66863}

[(i) Benefits received by employees pursuant to
Presidential Decree No. 851, as amended by
Memorandum Order No. 28, dated August 13, 1986;)

[(ii) Benefits received by officials and employees not
covered by Presidential Decree No. 851, as amended by
Memorandum Order No. 28 dated August 13, 1986; and]

[(iv) Other benefits such as productivity incentives and
Christmas bonus: Provided, further, That the ceiling of
Thirty thousand pesos (P30,000) may be increased
through rules and regulations issued by the Secretary of
Finance, upon recommendation of the Commissioner,
after considering, among others, the effect on the same of
the inflation rate at the end of the taxable year.]

(e[f]) GSIS, SSS, Medicare and Other Contribution. - GSIS, SSS,
Medicare and Pag-Ibig contributions, and union dues of
individuals.

(flg]) Gains from the Sale of Bonds, Debentures or other
Certificate of Indebtedness. — Gains realized from the sale or
exchange or retirement of bonds, debentures or other certificate
of indebtedness with a maturity of more than five (5) years.

(g{h]) Gains from Redemption of Shares in Mutual Fund. —
Gains realized by the investor upon the redemption of shares of
stock in a mutual fund company as defined in Section 22 (BB)
of this Code.

SEC. 8. Section 33 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 33. Special Treatment of Fringe Benefit. -

(AlImposition of Tax. - A final tax of THIRTY-TWO PERCENT (32%)
EFFECTIVE JANUARY 1, 2018; THIRTY PERCENT (30%) EFFECTIVE
JANUARY 1, 2019; THEREAFTER [thirty-four percent (34%) effective
January 1, 1998; thirty-three percent (33%) effective January 1, 1999;
and thirty-two percent (32%) effective January 1, 2000 and
thereafter], is hereby imposed on the grossed-up monetary value of
fringe benefit furnished or granted to the employee (except rank and
file employees as defined herein) by the employer, whether an
individual or a corporation (unless the fringe benefit is required by the
nature of, or necessary to the trade, business or profession of the
employer, or when the fringe benefit is for the convenience or

9


advantage of the employer). The tax herein imposed is payable by the
employer which tax shall be paid in the same manner as provided for
under Section 57 (A) of this Code. The grossed-up monetary value of
the fringe benefit shall be determined by dividing the actual monetary
value of the fringe benefit BY SIXTY-EIGHT PERCENT (68%)
EFFECTIVE JANUARY 1, 2018; SEVENTY PERCENT (70%)
EFFECTIVE JANUARY 1, 2019; AND THEREAFTER. by sixty-six
percent (66%) effective January 1, 1998; sixty-seven percent (67%)
effective January 1, 1999; and sixty-eight percent (68%) effective
January 1, 2000 and thereafter: Provided, however, That fringe benefit
furnished to employees and taxable under Subsections (B), (C), (D)
and (E) of Section 25 shall be taxed at the applicable rates imposed
thereat: Provided, further, That the grossed -up monetary value of the
fringe benefit shall be determined by dividing the actual monetary
value of the fringe benefit by the difference between one hundred
percent (100%) and the applicable rates of income tax under
Subsections (B), (C), (D), and (E) of Section 25.|

(B) Fringe Benefit Defined. - For purposes of this Section, the term
‘fringe benefit’ means any good, service or other benefit furnished or
granted in cash or in kind by an employer to an individual employee
(except rank and file employees as defined herein) such as, but not
limited to, the following:

(1) Housing;

(2) Expense account;

(3) Vehicle of any kind;

(4) Household personnel, such as maid, driver and others;

(5) Interest on loan at less than market rate to the extent of the
difference between the market rate and actual rate granted;

(6) Membership fees, dues and other expenses borne by the
employer for the employee in social and athletic clubs or other
similar organizations;

(7) Expenses for foreign travel;

(8) Holiday and vacation expenses;

(9) Educational assistance to the employee or his dependents;
and

(10) Life or health insurance and other non-life insurance
premiums or similar amounts in excess of what the law allows.


(C) Fringe Benefits Not Taxable. - The following fringe benefits are
not taxable under this Section:

[(1) Fringe benefitswhich are authorized and exempted from tax
under special laws;}

(1[2]} Contributions of the employer for the benefit of the
employee to retirement, insurance and hospitalization benefit
plans;

(2[3]) Benefits given to the rank and file employees, whether
granted under a collective bargaining agreement or not; and

(2{4]) De minimis benefits as defined in the rules and regulations
to be promulgated by the Secretary of Finance, upon
recommendation of the Commissioner.

The Secretary of Finance is hereby authorized to promulgate, upon
recommendation of the Commissioner, such rules and regulations as
are necessary to carry out efficiently and fairly the provisions of this
Section, taking into account the peculiar nature and special need of
the trade, business or profession of the employer.

SEC. 9. Section 34 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 34. Deductions from Gross Income.- Except for taxpayers
earning compensation income arising from personal services rendered
under an employer-employee relationship where no deductions shall
be allowed under this Section other than under subsection (M) hereof,
in computing taxable income subject to income tax under Sections
24(A); 25(A); 26; 27(A), (B) and (C); and 28(A)(1), there shall be allowed
the following deductions from gross income;

XXX XXX XXX

{L) Optional Standard Deduction (OSD). — For individual
taxpayers whose gross sales do not exceed PhP 5 million, and in
lieu of the deductions allowed under the preceding Subsections,
an individual subject to tax under Section 24, other than a
nonresident alien, may elect a standard deduction in an amount
not exceedingforty percent(40%) of his gross sales or gross
receipts, as the case maybe. [In the case of a corporation
subject to tax under Sections 27 (A) and 28 (A) (1), it may elect a
standard deduction in an amount not exceeding forty percent
(40%) of its gross income as defined in Section 32 of this Code.]
Unless the taxpayer signifies in his return his intention to elect
the optional standard deduction, he shall be considered as
having availed himself of the deductions allowed in the
preceding Subsections. Such election when made in the return

in


shall be irrevocable for the taxable year for which the return is
made: Provided, That an individual who is entitled to and
claimed for the optional standard deduction shall not be
required to submit with his tax return such financial
Statements otherwise required under this Code: Provided,
further, That except when the Commissioner otherwise permits,
the said individual shall keep such records pertaining to his
gross sales or gross receipts, or the said corporation shall keep
such records pertaining to his gross income as defined in
Section 32 of this Code] during the taxable year, as may be
required by the rules and regulations promulgated by the
Secretary of Finance, upon recommendation of the
Commissioner.

(4) Premium Payments on Health and/or
Hospitalization Insurance of an Individual Taxpayer The
amount of premiums not to exceed Two thousand four hundred
pesos (P2,400) per family or Two hundred pesos (P200) a month
paid during the taxable year for health and/or hospitalization
insurance taken by the taxpayer for himself, including his
family, shall be allowed as a deduction from his gross income:
Provided, That said family has a gross income of not more than
Two hundred fifty thousand pesos (P250,000) for the taxable
year: Provided, finally, That in the case of married taxpayers,
only the spouse claiming the additional exemption for
dependents shall be entitled to this deduction.|

XXX XXX KK
SEC. 10. Section 35 of the National Internal Revenue Code of 1997, as
amended, is hereby repealed and the succeeding Sections shall’ be
renumbered accordingly.

SEC. 11. Section 79 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 79. Income Tax Collected at Source.-
XXX OK XXX
[(D) Personal Exemptions.
(1) In General. - Unless otherwise provided by this
Chapter, the personal and additional exemptions
applicable under this Chapter shall be determined in
accordance with the main provisions of this Title.

(2) Exemption Certificate. -


fa) When to File. - On or before the date of
commencement of employment with an employer,
the employee shall furnish the employer with a
signed withholding exemption certificate relating to
the personal and additional exemptions to which he
is entitled.

(b) Change of Status. - In case of change of status of
an employee as a result of which he would be
entitled to a lesser or greater amount of exemption,
the employee shall, within ten (10) days from such
change, file with the employer a new withholding
exemption certificate reflecting the change.

(c) Use of Certificates. - The certificates filed
hereunder shall be used by the employer in the
determination of the amount of taxes to be
withheld.

(d) Failure to Furnish Certificate. - Where an
employee, in violation of this Chapter, either fails or
refuses to file a withholding exemption certificate,
the employer shall withhold the taxes prescribed
under the schedule for zero exemption of the
withholding tax table determined pursuant to
Subsection (A) hereof.]

OK KK

[(F) Husband and Wife.- When a husband and wife each are
recipients of wages, whether from the same or from different
employers, taxes to be withheld shall be determined on the
following bases:

(1) The husband shall be deemed the head of the family
and proper claimant of the additional exemption in
respect to any dependent children, unless he explicitly
waives his right in favor of his wife in the withholding
exemption certificate.

(2) Taxes shall be withheld from the wages of the wife in
accordance with the schedule for zero exemption of the

withholding tax table prescribed in Subsection (D)(2)(d)
hereof.]

SEC. 12. Section 106 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

13


SEC. 106. Value-Added Tax on Sale of Goods or Properties.-

(A) Rate and Base of Tax. - There shall be levied, assessed and
collected on every sale, barter or exchange of goods or
properties, a value-added tax equivalent to TWELVE|ten]
percent (12%) [(10%)] of the gross selling price or gross value in
money of the goods or properties sold, bartered or exchanged,
such tax to be paid by the seller or transferor: [Provided, That
the President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-
added tax to twelve percent (12%), after any of the following
conditions has been satisfied.

(i) Value-added tax collection as a percentage of
Gross Domestic product (GDP) of the previous year
exceeds two and four-fifth percent (2 4/5%); or

(ii) National government deficit as a percentage of
GDP of the previous year exceeds one
and one-half percent (1 1/2%).]

XXX XXX XXX

(2) The following sales by VAT-registered persons shall be
subject to zero-percent (0%) rate:

(a) Export Sales. - The term ‘export sales’ means:

(1) The sale and actual shipment of goods
from the Philippines to a foreign country,
irrespective of any shipping arrangement that
may be agreed upon which may influence or
determine the transfer of ownership of the
goods so exported and paid for in acceptable
foreign currency or its equivalent in goods or
services, and accounted for in accordance
with the rules and regulations of the
BangkoSentralngPilipinas (BSP);

[(2) Sale of raw materials or packaging
materials to a nonresident buyer for delivery
to a resident local export-oriented enterprise
to be used in manufacturing, processing,
packing or repacking in the Philippines of the
said buyer's goods and paid for in acceptable
foreign currency and accounted for in
accordance with the rules and regulations of
the BangkoSentralngPilipinas (BSP);]


[(3) Sale of raw materials or packaging
materials to export-oriented enterprise whose
export sales exceed seventy percent (70%) of
total annual production;]

(4) Sale of gold ~—s to. ~—_—the
BangkoSentralngPilipinas (BSP);]

[(5) Those considered export sales under
Executive Order No. 226, otherwise known as
the Omnibus Investment Code of 1987, and
other special laws; and]

(2(6]) The sale of goods, supplies, equipment
and fuel to persons engaged in international
shipping or international air transport
operations; PROVIDED, THAT THE GOODS,
SUPPLIES, EQUIPMENT AND FUEL SHALL
BE USED FOR INTERNATIONAL SHIPPING
AND AIR TRANSPORT OPERATIONS;

(3) DIRECT EXPORTS BY A REGISTERED
EXPORT PRODUCER OF EXPORTS
PRODUCTS, OR THE SALES OF EXPORT
PRODUCTS TO ANOTHER PRODUCER OR
TO AN EXPORT TRADER: PROVIDED, THAT
THE LATTER SHALL ONLY BE DEEMED
EXPORT SALES WHEN ACTUALLY
EXPORTED BY THE LATTER, AS
EVIDENCED BY LANDING CERTIFICATES
OR SIMILAR COMMERCIAL DOCUMENTS.

(b) Foreign Currency Denominated Sale.- The
phrase "foreign currency denominated sale" means
sale to a nonresident of goods, except those
mentioned in Sections 149 and 150, assembled or
manufactured in the Philippines for delivery to a
resident in the Philippines, paid for in acceptable
foreign currency and accounted for in accordance
with the rules and regulations of the
BangkoSentralngPilipinas{BSP);

(c) Sales to persons or entities whose exemption
under [special laws or] international agreements to
which the Philippines is a signatory effectively
subjects such sales to zero rate; AND

(D) SALE OF GOLD TO THE BANGKO SENTRAL NG
PILIPINAS (BSP);

15


SEC, 13, Section 107 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 107. Value-Added Tax on Importation of Goods. -

(A) In General.- There shall be levied, assessed and collected on
every importation of goods a value-added tax equivalent to
TWELVE |ten] percent (12[10]%) based on the total value used
by the Bureau of Customs in determining tariff and customs
duties plus customs duties, excise taxes, if any, and other
charges, such tax to be paid by the importer prior to the release
of such goods from customs custody: Provided, That where the
customs duties are determined on the basis of the quantity or
volume of the goods, the value-added tax shall be based on the
landed cost plus excise taxes, if any. [Provided, further, That the
President, upon the recommendation of the Secretary of
Finance, shall, effective January 1, 2006, raise the rate of value-
added tax to twelve percent (12%), after any of the following
conditions has been satisfied:

(i) Value-added tax collection as a percentage of Gross
Domestic Product (GDP) of the previous year exceeds two
and four-fifth percent (2 4/5%); or

(ii) National government deficit as a percentage of GDP of
the previous year exceeds one and one-half percent (1
1/2%)|

(B) Transfer of Goods by Tax-exempt Persons. —
‘XXX = =OXXX XXX

SEC. 14.Section 108 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 108. Value-added Tax on Sale of Services and Use or Lease
of Properties.—

(A) Rate and Base of Tax. - There shall be levied, assessed and
collected, a value-added tax equivalent to TWELVE [ten] percent
(12%) [(10%)] of gross receipts derived from the sale or exchange
of services, including the use or lease of properties. [Provided,
‘That the President, upon the recommendation of the Secretary
of Finance, shall, effective January 1, 2006, raise the rate of
value-added tax to twelve percent (12%), after any of the
following conditions has been satisfied:


(i) Value-added tax collection as a percentage of Gross
Domestic Product (GDP) of the previous year exceeds two
and four-fifth percent (2 4/5%); or

(ii) National government deficit as a percentage of GDP of
the previous year exceeds one and one-half percent (1
1/2%)]

XXX XXX XXX

(B) Transactions Subject to Zero Percent (0%) Rate-The
following services performed in the Philippines by VAT-
registered persons shall be subject to zero percent (0%) rate.

XXX XXX XXX

{(3) Services rendered to persons or entities whose exemption
under [special laws or] international agreements to which the
Philippines is a signatory effectively subjects the supply of such
services to zero percent (0%) rate;}

[(4) Services rendered to persons engaged in international
shipping or international air transport operations, including
leases of property for use thereof]

[(5) Services performed by subcontractors and/or contractors in
processing, converting, or manufacturing goods for an
enterprise whose export sales exceed seventy percent (70%) of
total annual production;]

(3[6]) Transport of passengers and cargo by air or sea vessels
from the Philippines to a foreign country;

[(7) Sale of power or fuel generated through renewable sources
of energy such as, but not limited to, biomass, solar, wind,
hydropower, geothermal, ocean energy, and other emerging
energy sources using technologies such as fuel cells and
hydrogen fuels. |

XXX XXX XXX

SEC.15. Section 109 of the National Internal Revenue Code of 1997, as
amended, 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:

v7


(A) Xxx
(B) Xxox;
(C) Xx;

[@) Importation of professional instruments and implements,
wearing apparel, domestic animals, and personal household
effects (except any vehicle, vessel, aircraft, machinery other
goods for use in the manufacture and merchandise of any kind
in commercial quantity) belonging to persons coming to settle in
the Philippines, for their own use and not for sale, barter or
exchange, accompanying such persons, or arriving within
ninety (90) days before or after their arrival, upon the
production of evidence satisfactory to the Commissioner, that
such persons are actually coming to settle in the Philippines
and that the change of residence is bona fide;)

(DJE}) Services subject to percentage tax under Title V;

(E[F)) Services by agricultural contract growers and milling for
others of palay into rice, corn into grits and sugar cane into raw
sugar;

(F[G]) Medical, dental, hospital and veterinary services except
those rendered by professionals.

(G[H]) Educational services rendered by private educational
institutions, duly accredited by the Department of
Education(DepED), the Commission on Higher Education
(CHED), the Technical Education and Skills Development
Authority (TESDAJand those rendered by government
educational institutions;

(H[I]) Services rendered by individuals pursuant to an employer-
employee relationship;

(I{J]) Services rendered by regional or area headquarters
established in the Philippines by multinational corporations
which act as supervisory, communications and coordinating
centers for their affiliates, subsidiaries or branches in the Asia-
Pacific Region and do not earn. or derive income from the
Philippines;

(J[K]) Transactionswhich are exempt under international
agreements to which the Philippines is a signatory [or under
special laws, except those under Presidential Decree No. 529];

[(L) Sales by agricultural cooperatives duly registered with the
Cooperative Development Authority to their members [as well as

18


sale of their produce, whether in its original state or processed
form, to non-members}; their importation of direct farm inputs,
machineries and equipment, including spare parts thereof, to be
used directly and exclusively in the production and/or
processing of their produce;]

[(M) Gross receipts from lending activities by credit or multi-
purpose cooperatives duly registered with the Cooperative
Development Authority;]

{(N) Sales by non-agricultural, non- electric and non-credit
cooperatives duly registered with the Cooperative Development
Authority: Provided, That the share capital contribution of each
member does not exceed Fifteen thousand pesos (P15, 000) and
regardless of the aggregate capital and net surplus ratably
distributed among the members;]

(L{O]) Export sales by persons who are not VAT-registered;

(M[P}) Sale of real properties not primarily held for sale to
customers Nor held for lease in the ordinary course of trade or
business [or real property utilized for low-cost and socialized
housing as defined by Republic Act No. 7279, otherwise known
as the Urban Development and Housing Act of 1992, and other
related laws, residential lot valued at One million pesos
(P1,500,000) and below, house and lot, and other residential
dwellings valued at Two million five hundred thousand pesos
(P2, 500, 000) and below: Provided, That not later than
January 31, 2009 and every three (3) years thereafter, the
amount herein stated shall be adjusted to their present values
using the Consumer Price Index, as published by the National
Statistics Office (NSO)};

[(Q) Lease of a residential unit with a monthly rental not
exceeding Ten thousand pesos (P10, 000): Provided, That not
later than January 31, 2009 and every three (3) years
thereafter, the amount herein stated shall be adjusted to its
present value using the Consumer Price Index as published by
the National Statistics Office (NSO);]

(N[R}) Sale, importation, printing or publication of books and
any newspaper, magazine review or bulletin which appears at
regular intervals with fixed prices for subscription and sale and
which is not devoted principally to the publication of paid
advertisements;

(|S) Transport of passengers by international carriers;


(P[T}) Sale, importation or lease of passenger or cargo vessels
and aircraft, including engine, equipment and spare parts
thereof for domestic or international transport operations;

[(U) Importation of fuel, goods and supplies by persons engaged
in international shipping or air transport operations;|

(Q[V}) Services of bank, non-bank financial intermediaries
performing quasi-banking functions, and other non-bank
financial intermediaries; and

(R[W}) Sale or lease of goods or properties or the performance of
services other than the transactions mentioned in the preceding
paragraphs, the gross annual sales and/or receipts do not
exceed the amount of FIVE MILLION [One million five hundred
thousand] pesos (P5,000,000.00 [P1,500,000)): Provided, That
not later than January 31, 2018 and every three (3) years
thereafter, the amount herein stated shall be adjusted to its
present valueusing the Consumer Price Index, as published by
the Philippine StatisticsAgency (PSA); and

(R) SALE OF POWER OR FUEL GENERATED THROUGH
RENEWABLE SOURCES OF ENERGY SUCH AS, BUT NOT
LIMITED TO, BIOMASS, SOLAR, WIND, HYDROPOWER,
GEOTHERMAL, OCEAN ENERGY, AND OTHER EMERGING
ENERGY SOURCES USING TECHNOLOGIES SUCH AS FUEL
CELLS AND HYDROGEN FUELS.

SEC. 16, Section 110 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

SEC. 110. Tax Credits. -
XXX XXX XXX

(B) Excess Output or Input Tax.f at the end of any taxable quarter
the output tax exceeds the input tax, the excess shall be paid by the
VAT-registered person, IF AT THE END OF THE FIRST THREE
TAXABLE QUARTERS, THE INPUT TAX EXCEEDS THE OUTPUT
TAX(If the input tax exceeds the output tax], the excess shall be
carried over to the succeeding quarter [or quarters]. ANY EXCESS
INPUT TAX AT THE END OF THE LAST QUARTER OF THE YEAR
SHALL NOT BE CARRIED OVER TO THE SUCCEEDING YEAR, BUT
SUCH EXCESS INPUT TAX MAY BE REFUNDED. Provided, however,
that any input tax attributable to zero-rated sales by a VAT-registered
person may at his option be refunded or credited against other
internal revenue taxes, subject to the provisions of Section 112.

PROVIDED FURTHER, THE ACCUMULATED EXCESS INPUT TAXES
CARRIED OVER FROM PRIOR YEARS TO THE YEAR 2018 MAY BE.

20


CARRIED OVER TO THE SUCCEEDING QUARTER OR QUARTERS OF
2018, PROVIDED THAT SUCH ACCUMULATED INPUT TAX SHALL
NOT BE CARRIED OVER TO THE SUCCEEDING YEAR (2019), BUT
THE SAME MAY BE REFUNDED AT THE END OF THE LAST
TAXABLE QUARTER OF 2018.

XXX XXX XXX

SEC. 17. Chapter 5 of Title V of the National Internal Revenue Code of 1997,
as amended, is hereby further amended to read as follows:

CHAPTER V
EXCISE TAX ON PETROLEUM PRODUCTS

SEC. 148. Manufactured Oils and Other Fuels.- There shall be
collected on refined and manufactured mineral oils and motor fuels,
the following excise taxes which shall attach to the goods hereunder
enumerated as soon as they are in existence as such:

EFFECTIVE ON JANUARY 1, 2017

(a) Lubricating oils and greases, including but not limited to,
basestock for lube oils and greases, high vacuum distillates, aromatic
extracts, and other similar preparations, and additives for lubricating
oils and greases, whether such additives are petroleum based or not,
per liter and kilogram respectively, of volume capacity or weight, TEN
[Four] pesos [and fifty centavos] (P10.00 [P4.50}) [: Provided, however,
‘That the excise taxes paid on the purchased feedstock (bunker) used
in the manufacture of excisable articles and forming part thereof shall
be credited against the excise tax due therefrom: Provided, further,
That lubricating oils and greases produced from basestocks and
additives on which the excise tax has already been paid shall no
longer be subject to excise tax: Provided, finally, That locally produced
or imported oils previously taxed as such but are subsequently
reprocessed, re-refined or recycled shall likewise be subject to the tax
imposed under this Section].

(b) Processed gas, per liter of volume capacity, SIX PESOS (P6.00)
[Five centavos (P0.05)};

(c) Waxes and petrolatum, per kilogram, TEN PESOS (P10.00) [Three
pesos and fifty centavos (P3.50)];

(4) On denatured alcohol to be used for motive power, per liter of
volume capacity, SIX PESOS (P6.00) [Five centavos (P0.05)|: Provided,
That unless otherwise provided by special laws, if the denatured
alcohol is mixed with gasoline, the excise tax on which has already
been paid, only the alcohol content shall be subject to the tax herein
prescribed. For purposes of this Subsection, the removal of denatured

21


alcohol of not less than one hundred eighty degrees (180") proof
(ninety percent (90%) absolute alcohol) shall be deemed to have been
removed for motive power, unless shown otherwise;

(c) Naphtha, regular gasoline and other similar products of distillation,
per liter of volume capacity, TEN [Four] pesos [and thirty five
centavos] (P10.00 [P4.35]): Provided, however, That naphtha, when
used as a raw material in the production of petrochemical products or
as replacement fuel for natural-gas-fired-combined cycle power plant,
in lieu of locally-extracted natural gas during the non-availability
thereof, subject to the rules and regulations to be promulgated by the
Secretary of Energy, in consultation with the Secretary of Finance, per
liter of volume capacity, Zero (P0.00): Provided, further, That the by-
product including fuel oil, diesel fuel, kerosene, pyrolysis gasoline,
liquefied petroleum gases and similar oils having more or less the
same generating power, which are produced in the processing of
naphtha into petrochemical products shall be subject to the
applicable excise tax specified in this Section, except when such by-
products are transferred to any of the local oil refineries through sale,
barter or exchange, for the purpose of further processing or blending
into finished products which are subject to excise tax under this
Section;

(f) Leaded premium gasoline, per liter of volume capacity, TEN [Five]
pesos and thirty-five centavos] (P10.00 [P5.35]); unleaded premium
gasoline, per liter of volume capacity, TEN [Four] pesos [and thirty-five
centavos] (P10.00 [P4.35});

(g) Aviation turbo jet fuel, per liter of volume capacity, TEN [Three]
pesos (and sixty-seven centavos] (P10.00 [P3.67]);

(h) Kerosene, per liter of volume capacity, SIX PESOS [Zero|(P6.00
[P0.00]): Provided,that kerosene, when used as aviation fuel, shall be
subject to the same tax on aviation turbo jet fuel under the preceding
paragraph (g), such tax to be assessed on the user thereof;

(i) Diesel fuel oil, and on similar fuel oils having more or less the same
generating power, per liter of volume capacity, SIX PESOS [zero]
(P6.00 [PO.00));

(i) Liquefied petroleum gas, per liter, SIX PESOS [zero] (P6.00 [PO.00)):
Provided,that liquefied petroleum gas used for motive power shall be
taxed at the equivalent rate as the excise tax on diesel fuel oil;

(k) Asphalts, per kilogram, SIX PESOS [Fifty-six centavos] (P6.00
[PO.56)); and

() Bunker fuel oil, and on similar fuel oils having more or less the
same generating power, per liter of volume capacity, SIX PESOS
[zero|(P6.00 [P0.00)).

22


“PROVIDED, HOWEVER, THAT THE EXCISE TAXES PAID ON
THE PURCHASED FEEDSTOCK (BUNKER) USED IN THE
MANUFACTURE OF EXCISABLE ARTICLES AND FORMING PART
THEREOF SHALL BE CREDITED AGAINST THE EXCISE TAX DUE
THEREFROM{(:],

“PROVIDED, FURTHER, THAT LUBRICATING OILS AND
GREASES PRODUCED FROM BASESTOCKS AND ADDITIVES ON
WHICH THE EXCISE TAX HAS ALREADY BEEN PAID SHALL NO
LONGER BE SUBJECT TO EXCISE TAX(:],

“PROVIDED, FINALLY, THAT LOCALLY PRODUCED OR
IMPORTED OILS PREVIOUSLY TAXED AS SUCH BUT ARE
SUBSEQUENTLY REPROCESSED, REREFINED OR RECYCLED
SHALL LIKEWISE BE SUBJECT TO THE TAX IMPOSED UNDER THIS.
SUB[S]SECTION.

“THE TAX RATES IMPOSED UNDER THIS SUBSECTION SHALL
BE INCREASED BY TEN PERCENT (10%) EVERY YEAR THEREAFTER
EFFECTIVE ON JANUARY 1, 2018 THROUGH REVENUE
REGULATIONS ISSUED BY THE SECRETARY OF FINANCE, , UNLESS
THE AVERAGE DUBAI CRUDE OIL PRICE IN THE MONTH
PRECEEDING THE SCHEDULED INDEXATION EXCEEDS EIGHTY
FIVE U.S. DOLLARS (USD 85) PER BARREL.

SEC.18. Chapter 5 of Title VI of the National Internal Revenue Code of 1997,
as amended, is hereby further amended to read as follows:

CHAPTER VI - EXCISE TAX ON MISCELLANEOUS ARTICLES
SEC. 19. Automobiles!There shall be levied, assessed and collected an ad
valorem tax on automobiles based on the manufacturer's or importer’s
selling price, net of excise and value-added tax, in accordance with the
following schedule:

Net manufacturer's

price/importer’s selling Rate
price

Up to —P600 5% [2%]
‘Thousand

[P12, 000 + ] 20% of NET

Over P600 Thousand to MANUFACTURING/IMPORTATION

P1.1 million PRICE |value in excess of P600
thousand]

“'As amended by RA 9224 and implemented by RR 25-03. See RMC 60-03 for clarification
on issues pertaining to the imposition of excise tax on automobiles pursuant to RA 9224.

23


[P112, 000 +) 40% of NET
MANUFACTURING /IMPORTATION
PRICE [value in excess of P1.1
Million]

Over P1.1 Million to
P2.1 Million

[P512,000 +] 60% of NET
MANUFACTURING /IMPORTATION

Over P2.1 Million PRICE [value in excess of P2.1
Million}

Provided, That the brackets reflecting the manufacturer's price or
importer's selling price, net of excise and value-added taxes, will be indexed
by the Secretary of Finance once every two (2) years if the change in the
exchange rate of the Philippine peso against the United States (U.S.) dollar
is more than ten percent (10%) from the date of effectivity of this Act, in the
case of initial adjustment and from the last revision date in the case of
subsequent adjustments.

‘The manufacturer's price or importer’s selling price, net of excise and
value-added taxes, shall be indexed by the full rate of the peso depreciation
or appreciation, as the case may be.

Provided, further, that in case the change in the exchange rate of the
Philippine peso against the U.S. dollar is at least twenty percent (20%) at
anytime within the two-year period referred to above, the Secretary of
Finance shall index the brackets reflecting the manufacturer's price or
importer’s selling price, net of excise and value-added taxes, by the full rate
of the peso depreciation or appreciation, as the case may be.

As used in this Section -

{a) Automobile shall mean any four (4) or more wheeled motor vehicle
regardless of seating capacity, which is propelled by gasoline, diesel,
electricity or any other motive power: Provided, That for purposes of this Act,
buses, trucks, cargo vans, jeeps/jeepneys/jeepney substitutes, single cab
chassis, and special-purpose vehicles shall not be considered automobiles.

(b) Truck/cargo van shall mean a motor vehicle of any configuration
that is exclusively designed for the carriage of goods and with any number of
wheels and axles: Provided, That pick-ups shall not be considered as trucks.

(c) Jeep/jeepney/jeepney substitutes shall mean as “Philippine jeep or

jeepney” which are of the jitney type locally designed and manufactured
generally from surplus parts and components. It shall also include jeepney

24


substitutes that are manufactured from brand-new single cab chassis or
cowl chassis and locally customized rear body that has continuous sideway
row seats with open rear door and without retractable glass windows.

(a) Bus shall mean a motor vehicle of any configuration with gross
vehicle weight of 4.0 tons or more with any number of wheels and axles,
which is generally accepted and specially designed for mass or public
transportation.

(c) Single cab chassis shall mean a motor vehicle with complete engine
power train and chassis equipped with a cab that has a maximum of two (2)
doors and only one (1) row of seats.

() Special purpose vehicle shall mean a motor vehicle designed for
specific applications such as cement mixer, fire truck, boom truck,
ambulance and/or medical unit, and off-road vehicles for heavy industries
and not for recreational activities.

Provided, That in the case of imported automobiles not for sale, the
tax imposed herein shall be based on the total landed value, including
transaction value, customs duty and all other charges.

Automobiles used exclusively within the freeport zone shall be exempt from
excise tax.

Sec, 20. Section 288 of the National Internal Revenue Code of 1997, as
amended, is hereby further amended to read as follows:

Xxx

Xxx

Xxx

Xxx

EARMARKING OF INCREMENTAL REVENUES FROM THE TAX
REFORM FOR ACCELERATION AND INCLUSION ACT. TWENTY
FIVE PERCENT (25%) OF THE INCREMENTAL REVENUES
GENERATED FROM THE PETROLEUM EXCISE TAX UNDER
SECTION XX OF THIS ACT SHALL BE ALLOCATED TO FUND
HIGHLY TARGETED SUBSIDY PROGRAMSIN THE FIRST THREE
YEARS FROM THE EFFECTIVITY OF THIS ACT. AN INTER-
AGENCY COMMITTEE COMPOSED OF THE DEPARTMENT OF
SOCIAL WELFARE AND DEVELOPMENT, DEPARTMENT OF
FINANCE AND THE DEPARTMENT OF BUDGET AND
MANAGEMENT SHALL PREPARE THE SUBSIDY PROGRAMS.

smpOm>

THE REMAINING SEVENTY-FIVE PERCENT (75%) SHALL BE
ALLOCATED FOR OTHER SOCIAL AND INFRASTRUCTURE
EXPENDITURES. PROVIDED, THAT THE REVENUES FROM THIS
ACT SHALL ACCRUE TO THE GENERAL FUND AFTER THE
THREE-YEAR PERIOD.


THE INTER-AGENCY COMMITTEE SHALL ISSUE RULES AND
REGULATIONS GOVERNING THE ALLOCATIONS AND
DISBURSEMENT OF INCREMENTAL REVENUES REFERRED TO
IN THIS PARAGRAPH.

SEC. 21. Implementing Rules and Regulation. The Secretary of Finance
shall, upon the recommendation of the Commissioner of Internal Revenue,
promulgate upon the effectivity of this Act the necessary Rules and
Regulations for its effective implementation.

SEC.22. Separability Clause— If any provision of this Act is subsequently
declared invalid or unconstitutional, other provisions hereof which are not
affected thereby shall remain in full force and effect.

SEC. 23. Repealing Clause. The following laws or provisions of laws are
hereby repealed and the persons and/or transactions affected herein are
made subject to the value-added Tax subject to the provision of Title IV of
the National Internal Revenue Code of 1997, as amended:

(a) Section 4 of R.A. 9994 or the Expanded Senior Citizens Act of
2010, pertaining to the value-added tax exemption;

(b) Section 32(a) of R.A. 7277, as amended by R.A. 10754 or the
Magna Carta for Persons with Disability;

(c) Section 9, with respect to Value-added Tax, or R.A. 9511 or the
National Grid Corporation of the Philippines Act;

(a

Article 61(2)(b) of R.A. 9520 or the Philippine Cooperative Code of
2008;

(e)

Section 4{a) and (b) of R.A. 9295 or the Domestic Shipping
Development Act of 2004;

(), Section 11(a) and (b) of R.A. 10073 or the Girl Scout of the
Philippines Charter of 2009;

(g) Section 13(1), with respect to Value-added Tax, or P.D. 1869 s.
1983.

(h) Last paragraph of Section 8 of RA 7278 or the Boy Scout of the
Philippines with respect to Value-added tax.

Provided further, the following special provisions under specific laws are
hereby repealed:

(a) Section 33(A) of R.A. 7277, as amended by R.A. 10754or the
Magna Carta for Persons with Disabilities; and

26


(b) Section 22(B) of R.A. 10165 or the Foster Care Act of 2012.

(c) Section 4 or RA 1169 or “An Act Providing For Charity
Sweepstakes, Horse Races and Lotteries”

All other laws, acts, presidential decrees, executive orders, issuances,
presidential proclamations, 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 25. Effectivity Clause This Act shall take effect fifteen (15)
days after its complete publication in the Official Gazette or in at least two
(2) newspapers of general circulation.

Approved.

27