Sf-ifeT/?.:
senate
NINETEENTH CONGRESS OF THE ] 
REPUBLIC OF THE PHILIPPINES ] 
First Regular Session 
]
of tlir ^rcrftnr^
*22 SEP 27 Pin3
S.B. No.
SENATE
1346
RECEIVWBY:
Introduced by SEN. WIN GATCHALIAN
AN ACT
INTRODUCING ADMINISTRATIVE TAX REFORMS, AMENDING SECTIONS 
22, 51, 56, 57, 58, 77, 81, 90, 91,103,106,108,109, 110,112,113,114, 
115, 116, 117, 118,119, 120, 128, 200, 236, 237, 245, and 248 OF THE 
NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND FOR
OTHER PURPOSES
EXPLANATORY NOTE
The passage of Republic Act (RA) No. 10963 or the TRAIN law, and RA 11534 
or the CREATE law laid down the groundwork for reforming our tax regimes by making 
it more equitable and simplified for the benefit of the taxpayers. However, such 
progress will be for naught if the appropriate administrative reforms will not be put 
into place.
Administrative feasibility is one of the canons of a sound tax system. It simply 
means that the tax system should be capable of being effectively administered and 
enforced with the least inconvenience to the taxpayer.1 In the Philippines, the self- 
assessment system, where the taxpayer computes the tax due himself, is used to 
determine the taxpayer's internal revenue taxes due to the government. As it puts the 
burden of computing tax liability to the taxpayer, it is important that the government 
puts in place a tax administration system that is effective and expedient with an end 
goal of promoting taxpayers' ease of compliance of tax laws and regulations.
1 Diaz vs. Secretary of Finance, 654 SCRA 96, July 19, 2011


Taxpayers are the government's clients, and it is incumbent upon the 
government to be efficient and innovative in its delivery of services. The goal must be 
to provide taxpayers with convenient and responsive service so as to encourage them 
to pay their taxes truthfully and timely.
The current Philippine tax administration system needs to be modernized by 
streamlining processes and lifting barriers that prevent taxpayers from complying with 
tax laws with ease. Thus, this bill proposes to introduce the following administrative 
reforms to simplify tax compliance and strengthen taxpayer rights as follows:
1) Provide taxpayers the option of filing their returns, and paying the taxes 
due thereon either personally or through electronic means;
2) Allow payment of internal revenue taxes due to any authorized agent 
bank (AAB), and not only limited to AABs in the revenue district office 
where the taxpayer is registered;
3) Remove the option to pay internal revenue taxes to city or municipal 
treasurer with jurisdiction over the taxpayer;
4) Eliminate the distinction between documentation and basis of sales of 
goods and services, thereby requiring sales invoice for both;
5) Allow the adjustment of the VAT exemption threshold based on the 
Consumer Price Index (CPI) not later than January 1, 2023 and every 3 
years thereafter; and
6) Ensure the availability of registration facilities to taxpayers not residing 
in the country.
These administrative reforms will not only give premium to taxpayers' welfare 
but also guarantee sustained revenue growth for the country and the future 
generations.
In view of the foregoing, the passage of this measure is ^inestly sought.


NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
SENATE
S. B. No. 1346
t;^
of tijt- ^>1 n i lfirjt
■2 SEP 27 P1:13
RECErVEO BY:
Introduced by SEN. WIN GATCHALIAN
1
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AN ACT
INTRODUCING ADMINISTRATIVE TAX REFORMS, AMENDING 
SECTIONS 22, 51, 56, 57, 58, 77, 81, 90, 91, 103, 106, 108, 109, 
110, 112, 113, 114, 115, 116, 117, 118, 119, 120, 128, 200, 236, 
237, 245, and 248 OF 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. Tide. - This Act shall be known as the "Ease of Paying 
Taxes Act."
SEC. 2. Declaration of Policy. - It is hereby declared the policy of the
State:
(1) 
To provide a healthy environment for the tax paying public that 
protects and safeguards taxpayer rights and welfare, as well as assures the fair 
treatment of all taxpayers;
(2) 
To modernize tax administration and improve its efficiency and 
effectiveness by providing mechanisms that encourage proper and easy 
compliance at the least cost and resources possible;
(3) 
To update the taxation system, adopt best practices, and replace 
antiquated procedures such as requiring the filing of a return or declaration for


1 
the payment of taxes or the "pay as you file" system and restriction of venue
2 
for filing and payment; and
3 
(4) To enact policies and procedures which are appropriate to
4 
different types of taxpayers.
5
6 
SEC. 3. Section 22 of the National Internal Revenue Code of 1997, as
7 
amended, is hereby further amended to read as follows:
8 
"SEC. 22. Definitions. — When used in this Title:
9 
XXX
10 
(II) THE TERM p]'FILING OF RETURN[-]' SHALL REFER
11 
TO THE ACT OF ACCOMPLISHING AND SUBMITTING THE
12 
PRESCRIBED TAX RETURN, IN PAPER FORM OR ELECTRONIC
13 
FORM, TO THE BUREAU OF INTERNAL REVENUE AS REQUIRED
14 
UNDER THIS CODE OR AS PRESCRIBED UNDER EXISTING
15 
RULES AND REGULATIONS.
16 
(KK) THE TERM [-]'PAYMENT OF TAX[-]' OR
17 
[-I'REMITTANCE OF TAX[-]' SHALL REFER TO THE ACT OF
18 
DELIVERING THE AMOUNT OF TAX DUE OR WITHHELD, EITHER
19 
PERSONALLY OR ELECTRONICALLY, TO THE BUREAU OF
20 
INTERNAL REVENUE AS REQUIRED UNDER THIS CODE OR AS
21 
PRESCRIBED UNDER EXISTING RULES AND REGULATIONS."
22
23 
SEC. 4. Section 51 of the National Internal Revenue Code of 1997, as
24 
amended, is hereby further amended to read as follows:
25 
"SEC. 51. Individual Returns. -
26 
XXX
27 
(B) Where to File. - Except in cases where the Commissioner
28 
otherwise permits, the return shall be filed, EITHER PERSONALLY OR
29 
ELECTRONICALLY, with anY authorized agent bank. Revenue District
30 
Officer, OR Coliection Agent [or duly authorized Treasurer of the
31 
city or municipality in which such person has his legal rosidence
32 
or principal place of business in the Philippines, or if there be


1 
no legal residence or placo-of business in the PhilippinesT-with
2 
the Office of the Commissioner.]"
3 
XXX
4 
(D) Husband and Wife. - Married individuals, whether citizens,
5 
resident or nonresident aliens, who do not derive income purely from
6 
compensation, shall file, EITHER PERSONALLY 
OR
7 
ELECTRONICALLY, a return for the taxable year to include the income
8 
of both spouses, but where it is impracticable for the spouses to file one
9 
return, each spouse may file a separate return of income but the returns
10 
so filed shall be consolidated by the Bureau for purposes of verification
11 
for the taxable year.
12
13 
SEC. 5. Section 56 of the National Internal Revenue Code of 1997, as
14 
amended, is hereby further amended to read as follows:
15 
"SEC. 56. Payment and Assessment of Income Tax for Individuals
16 
and Corporations. -
17 
(A) Payment of Tax. -
18 
(1) In General. - The total amount of tax imposed by this
19 
Title shall be paid, EITHER PERSONALLY OR
20 
ELECTRONICALLY, by the person subject thereto [at the
21 
time] DURING the FILING OF THE return [is filed]. In the
22 
case of tramp vessels, the shipping agents and/or the husbanding
23 
agents, and in their absence, the captains thereof are required to
24 
file the return herein provided and pay the tax due thereon before
25 
their departure. Upon failure of the said agents or captains to file
26 
the return and pay the tax, the Bureau of Customs is hereby
27 
authorized to hold the vessel and prevent its departure until proof
28 
of payment of the tax is presented or a sufficient bond is filed to
29 
answer for the tax due."
30
31 
SEC. 6. Section 57 of the National Internal Revenue Code of 1997, as
32 
amended, is hereby further amended to read as follows:


1 
SEC. 57. Withholding of Tax at Source. —
2 
(A) 
XXX
3 
(B) 
XXX
4 
(C) 
TIMING OF WITHHOLDING TAXES. - THE
5 
OBLIGATION TO DEDUCT AND WITHHOLD THE TAX
6 
ARISES AT THE TIME PAYMENT IS MADE.
7 
(D) [{€}] Tax-free Covenant Bonds - xxx
8
9 
SEC. 7. Section 58 of the National Internal Revenue Code of 1997, as
10 
amended, is hereby further amended to read as follows:
11 
"SEC. 58. Return and Payment of Taxes Withheld at Source. -
12 
(A) Quarterly Returns and Payments of Taxes Withheld. -
13 
Taxes deducted and withheld under Section 57 by withholding agents
14 
shall be covered by a return and paid to, EITHER PERSONALLY OR
15 
ELECTRONICALLY, except in cases where the Commissioner otherwise
16 
permits, anY authorized agent bank (AAB), Revenue District Officer, OR
17 
Collection Agent [, or duly authorized Treasurer of the-cky-of
18 
municipality where the withholding agent has -his—legal
19 
rosidoncG or—principal—place—of--business7—or where the
20 
withholding-agent-is-a-eerporation, where the principal office is
21 
located]."
22
23 
SEC. 8. Section 77 of the National Internal Revenue Code of 1997, as
24 
amended, is hereby amended to read as follows:
25 
"SEC. 77. Place and Time of Filing and Payment of Quarterly Corporate
26 
Income Tax. -
27 
(A) Place of Filing. - Except as the Commissioner otherwise
28 
permits, the quarterly income tax declaration required in Section 75 and
29 
the final adjustment return required in Section 76 shall be filed EITHER
30 
PERSONALLY OR ELECTRONICALLY, with [the] ANY [authorized
31 
agent bank] AAB or Revenue District Officer or Collection Agent [of


1 
duly authorized Treasurer of the city -or municipality having
2 
jurisdiction-over the location of the principal -office-of the
3 
corporation filing the-return or place where its main books of
4 
accounts and other data from which the return is prepared are
5 
kept],
6 
(B) Time of Filing the Income Tax Return. - The corporate
7 
quarterly declaration shall be filed, EITHER PERSONALLY OR
8 
ELECTRONICALLY, within sixty (60) days following the close of each
9 
of the first three (3) quarters of the taxable year. The final adjustment
10 
return shall be filed on or before the fifteenth (15th) day of April, or on
11 
or before the fifteenth (15th) day of the fourth (4th) month following
12 
the close of the fiscal year, as the case may be.
13 
(C) Time of Payment of the Income Tax. - The income tax due
14 
on the corporate quarterly returns and the final adjustment income tax
15 
returns computed in accordance with Sections 75 and 76 shall be paid,
16 
EITHER PERSONALLY OR ELECTRONICALLY, [at the time]
17 
DURING THE FILING OF the declaration or return [is filed], in a
18 
manner prescribed by the Commissioner."
19
20 
SEC. 9. Section 81 of the National Internal Revenue Code of 1997, as
21 
amended, is hereby amended to read as follows:
22 
"SEC. 81. Filing of Return and Payment of Taxes Withheld. -
23 
Except as the Commissioner otherwise permits, taxes deducted and
24 
withheld by the employer on wages of employees shall be covered by a
25 
return and paid, EITHER PERSONALLY OR ELECTRONICALLY, to
26 
anY [authorized—agent—hank] AAB, REVENUE DISTRICT
27 
OFFICER, OR Collection Agent [, or the duly authorized Treasurer
28 
of the-city or municipality where the employer has his legal
29 
residence or principal place of business, or in case the employer
30 
is a corporation, where the principal office is located]."
31 
The return shall be filed and [the payment made] PAID,
32 
EITHER PERSONALLY OR ELECTRONICALLY, within twenty-five


1 
(25) days from the close of each calendar quarter: Provided, however,
2 
That the Commissioner may, with the approval of the Secretary of
3 
Finance, require the employers to pay or deposit the taxes deducted and
4 
withheld at more frequent intervals, in cases where such requirement is
5 
deemed necessary to protect the interest of the Government.
6 
The taxes deducted and withheld by employers shall be held in a
7 
special fund in trust for the Government until the same are paid to the
8 
said collecting officers.
9
10 
SEC. 10. Section 90 of the National Internal Revenue Code of 1997, as
11 
amended, is hereby further amended to read as follows:
12 
"SEC. 90. Estate Tax Returns. -
13 
XXX
14 
(D) Place of Filing. - Except in cases where the
15 
Commissioner otherwise permits, the return required under
16 
Subsection (A) shall be filed, EITHER PERSONALLY OR
17 
ELECTRONICALLY, with anY [authorized agent bank] AAB,
18 
fw} Revenue District Officer, OR Collection Officer[, or duly
19 
authorized Treasurer of the city or municipality in which
20 
the decedent was domiciled at the time of his death or if
21 
there be no legal residence in the Philippines, with the
22 
Office of the Commissioner]."
23
24 
SEC. 11. Section 91 of the National Internal Revenue Code of 1997, as
25 
amended, is hereby further amended to read as follows:
26 
"SEC. 91. Payment of Tax. -
27 
(A) Time of Payment - The estate tax imposed by Section
28 
84 Shall be paid, EITHER PERSONALLY OR
29 
ELECTRONICALLY, [at the time] DURING THE FILING OF
30 
the return [is filed] by the executor, administrator, or the heirs."
31 
XXX


1 
(D) Liability for Payment - The estate tax imposed by
2 
Section 84 shall be paid, EITHER PERSONALLY OR
3 
ELECTRONICALLY, by the executor or administrator before
4 
delivery to any beneficiary of his distributive share of the estate.
5 
Such beneficiary shall to the extent of his distributive share of the
6 
estate, be subsidiarily liable for the payment of such portion of
7 
the estate tax as his distributive share bears to the value of the
8 
total net estate.
9 
XXX 
10
11 
SEC. 12. Section 103 of the National Internal Revenue Code of 1997, as
12 
amended, is hereby amended to read as follows:
13 
"SEC. 103. Filing of Return and Payment of Tax. -
14 
(A) X X X
15 
(B) Time and Place of Filing and Payment - The return of
16 
the donor required in this Section shall be filed, EITHER
17 
PERSONALLY OR ELECTRONICALLY, within thirty (30) days
18 
after the date the gift is made, and the tax due thereon shall be
19 
paid, EITHER PERSONALLY OR ELECTRONICALLY, [at the
20 
time of filing] DURING THE FILING OF THE DECLARATION
21 
OR RETURN IN A MANNER PRESCRIBED BY THE
22 
COMMISSIONER. Except in cases where the Commissioner
23 
otherwise permits, the return shall be filed and the tax paid,
24 
EITHER PERSONALLY OR ELECTRONICALLY, to anY
25 
[authorized agent bank] AAB, [the] Revenue District Officer,
26 
OR Revenue Collection Officer [or duly authorized Treasurer
27 
of the city or municipality where the donor was domiciled
28 
at the-time of the transfer, or if there be no legal
29 
residence in the Philippines, with the Office of the
30 
Commissioner]. In the case of gifts made by a nonresident, the
31 
return may be filed, EITHER PERSONALLY OR
32 
ELECTRONICALLY, with the Philippine Embassy or Consulate in


1 
the country where he is domiciled at the time of the transfer, or
2 
directly with the Office of the Commissioner,"
3
4 
SEC. 13. Section 106 of the National Internal Revenue Code of 1997,
5 
as amended, is hereby further amended to read as follows:
6 
"SEC. 106. 
Value-Added Tax on Sale of Goods or
1 
Properties. -
8 
XXX
9 
(D) 
Sales 
Returns^ 
Allowances and Sales
10 
Discounts. - The value of goods or properties sold and
11 
subsequently returned or for which allowances were granted by
12 
a VAT-registered person may be deducted from the gross sales
13 
[or receipts] for the quarter in which a refund is made or a
14 
credit memorandum or refund is issued. Sales discount granted
15 
and indicated in the invoice at the time of sale and the grant of
16 
which does not depend upon the happening of a future event
17 
may be excluded from the gross sales within the same quarter
18 
it was given."
19 
(E) 
XXX
20
21 
SEC. 14. Section 108 of the National Internal Revenue Code of 1997,
22 
as amended, is hereby further amended to read as follows:
23 
"SEC. 108. Value-added Tax on Sale of Services and Use or Lease
24 
of Properties. -
25 
(A) Rate and Base of Tax. - There shall be levied, assessed
26 
and collected, a value-added tax equivalent to twelve percent (12%) of


1 
gross [receipts] SALES derived from the sale or exchange of services,
2 
including the use or lease of properties."
3 
XXX
4 
FOR PURPOSES OF VAT, [The] THE term gross [receipts] SALES'
5 
means the total amount of money or its equivalent [roprosonting the
6 
centract-price, compensation, service fee, rental or royalty,-
7 
including the amount charged for materials supplied with the
8 
services and deposits -and -advance#-paymonts actually or
9 
constructively-received-during- the taxable quarter for the
10 
services performed or to be performed for another person,]
11 
WHICH THE PURCHASER PAYS OR IS OBLIGATED TO PAY TO
12 
THE SELLER IN CONSIDERATION OF THE SALE, BARTER, OR
13 
EXCHANGE OF SERVICES AND THE USE OR LEASE OF
14 
PROPERTIES, excluding value-added tax. THE LIABILITY TO PAY
15 
VAT SHALL BE AT THE TIME OF THE ISSUANCE OF THE INVOICE.
16
17 
(B) 
Transactions Subject to Zero Percent (0%) Rate. - x x x
18 
(C) 
SALES RETURNS, ALLOWANCES AND SALES
19 
DISCOUNTS. - THE VALUE OF SERVICES SOLD AND
20 
SUBSEQUENTLY REFUNDED OR FOR WHICH ALLOWANCES
21 
WERE GRANTED BY A VAT-REGISTERED PERSON MAY BE
22 
DEDUCTED FROM THE GROSS SALES FOR THE QUARTER IN
23 
WHICH A REFUND IS MADE OR A CREDIT MEMORANDUM IS
24 
ISSUED. ANY SALES DISCOUNT GRANTED AND INDICATED IN
25 
THE INVOICE AT THE TIME OF SALE AND THE GRANT OF WHICH
26 
DOES NOT DEPEND UPON A FUTURE EVENT MAY BE EXCLUDED
27 
FROM THE GROSS SALES OF THE QUARTER IT WAS GIVEN.
28
29 
SEC. 15. Section 109 of the National Internal Revenue Code of 1997, as
30 
amended, is hereby further amended to read as follows:
31 
"SEC. 109. Exempt Transactions. -


1 
(1) Subject to the provisions of Subsection (2) hereof, the
2 
following transactions shall be exempt from the value-added tax:
3 
XXX
4 
(CC) Sale or lease of goods or properties or the
5 
performance of services other than the transactions mentioned in
6 
the preceding paragraphs, the gross annual sales [aRd/oF
7 
receipts] do not exceed the amount of Three million pesos
8 
(P3,000,000)[.]; PROVIDED, THAT THE AMOUNT HEREIN
9 
STATED SHALL BE ADJUSTED TO ITS PRESENT VALUE
10 
NOT LATER THAN JANUARY 1, 2023, AND EVERY THREE
11 
(3) YEARS THEREAFTER, BASED ON THE CONSUMER
12 
PRICE INDEX (CPI) THAT IS PUBLISHED BY THE
13 
PHILIPPINE STATISTICS AUTHORITY (PSA).
14
15 
SEC. 16. Section 110 of the National Internal Revenue Code of 1997, as
16 
amended, is hereby further amended to read as follows:
17 
"SEC. no. Tax Credits. -
18 
(A) Creditable Input Tax. -
19 
(1) Any input tax evidenced by a VAT invoice [or official
20 
receipt] issued in accordance with Section 113 hereof on the
21 
following transactions shall be creditable against the output tax:
22 
(a) Purchase or importation of goods:
23 
(i) For sale; or
24 
(ii) For conversion into or intended to form part
25 
of a finished product for sale including
26 
packaging materials; or
27 
(iii) For use as supplies in the course of
28 
business; or
10


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(iv) For use as materials supplied in the sale of 
service; or
(v) For use in trade or business for which 
deduction for depreciation or amortization is 
allowed under this Code.
(b) Purchase of services on which a value-added 
tax has been actually [paid] BILLED BY THE 
SUPPLIER.”
SEC. 17. Section 112 of the National Internal Revenue Code of 1997, 
as amended, is hereby further amended to read as follows:
"SEC. 112. Refunds or Tax Credits of Input Tax. —
XXX
(C) Period within which THE Refund of Input Taxes shaii 
be Made. - In proper cases, the Commissioner shall grant a 
refund for creditable input taxes within ninety (90) days from the 
date of submission of the [official rocGipt or] invoices and 
other documents in support of the application filed in accordance 
with Subsections (A) and (B) hereof: Provided, r/?af should the 
Commissioner find that the grant of refund is not proper, the 
Commissioner must state in writing the legal and factual basis for 
the denial.
SEC. 18. Section 113 of the National Internal Revenue Code of 1997, 
25 as amended, is hereby amended to read as follows:
11


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"SEC. 113. Invoicing and Accounting Requirements for 
VAT-Registered Persons. —
(A) Invoicing Requirements^ — A VAT-registered person
shall issue [i
W-A] A VAT invoice for every sale, barter, or exchange 
OR LEASE of goods or properties {;-and
(2) A VAT official receipt for every lease of goods or 
proportios,] and for every sale, barter or exchange of services."
(B) Information Contained in the VAT Invoice {or VAT 
Official Receipf\. — The following information shall be indicated 
in the VAT invoice [or VAT official receipt]:
(1) A statement that the seller is a VAT-registered person, 
followed by [his] THE SELLER'S Taxpayer's Identification 
Number (TIN);
(2) The total amount which the purchaser pays or is 
obligated to pay to the seller with the indication that such amount 
includes the value-added tax: Provided, That:
(a) The amount of the tax shall be shown as a separate 
item in the invoice [or receipt];
(b) If the sale is exempt from value-added tax, the term 
'VAT-exempt sale' shall be written or printed prominently on the 
invoice [or roccipt];
12


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(c) If the sale is subject to zero percent (0%) value-added 
tax, the term 'zero-rated sale' shall be written or printed 
prominently on the invoice [or receipt];
(d) If the sale involves goods, properties or services some 
of which are subject to and some of which are VAT zero-rated or 
VAT-exempt, the invoice [or-receipt] shall clearly indicate the 
break-down of the sale price between its taxable, exempt and 
zero-rated components, and the calculation of the value-added 
tax on each portion of the sale shall be shown on the invoice [or 
receipt]: Provided, That the. seller may issue separate invoices 
[or receipts] for the taxable, exempt, and zero-rated 
components of the sale.
(3) X X X
(4) X X X
(C) X X X
(D) Consequence of Issuing AN Erroneous VAT Invoice
[or VAT Official Receipt}. —
(1) If a person who is not a VAT-registered person issues 
an invoice [or receipt] showing [Ims] THE PERSON'S
Taxpayer Identification Number (TIN), followed by the word 
■VAT:
(a) The issuer shall, in addition to any liability to other 
percentage taxes, be liable to:
13


1 
(i) The tax imposed in Section 106 or 108 without the
2 
benefit of any input tax credit; and
3 
(ii) A fifty percent (50%) surcharge under Section 248 (B)
4 
of this Code;
5 
(b) The VAT shall, if the other requisite information
6 
required under Subsection (B) hereof is shown on the invoice [er
7 
receipt], be recognized as an input tax credit to the purchaser
8 
under Section 110 of this Code.
9 
(2) If a VAT-registered person issues a VAT invoice [or
10 
VAT official receipt] for a VAT-exempt transaction, but fails to
11 
display prominently on the invoice [or receipt] the term 'VAT-
12 
exempt sale', the issuer shall be liable to account for the tax
13 
imposed in Section 106 or 108 as if Section 109 did not apply.
14
15 
SEC. 19. Section 114 of the National Internal Revenue Code of 1997, as
16 
amended, is hereby further amended to read as follows:
17 
"SEC. 114. Return and Payment of Value-Added Tax. -
18 
(A) 7/7 G’e/7e/'a/. — Every person liable to pay the value-
19 
added tax imposed under this Title shall file, EITHER
20 
PERSONALLY OR ELECTRONICALLY, a quarterly return of
21 
the amount of his gross sales [or receipts] within twenty-five
22 
(25) days following the close of each taxable quarter prescribed
23 
for each taxpayer: Provided, however. That VAT-registered
24 
persons shall pay, EITHER PERSONALLY OR
14


1 
ELECTRONICALLY, the value-added tax on a monthly basis:
2 
Provided, finally, That beginning January 1, 2023, the filing and
3 
payment required under this Subsection shall be done within
4 
twenty-five (25) days following the close of each taxable quarter.
5 
XXX
6 
(B) Where to File the Return and Pay the Tax. -
7 
Except as the Commissioner otherwise permits, the return shall
8 
be filed with and the tax paid, EITHER PERSONALLY OR
9 
ELECTRONICALLY, to anY [authorized agent bank] AAB,
10 
OR Revenue Collection Officer [or-duly-authorized city or
11 
municipal Treasurer in the Philippines located within the
12 
revenue district where the taxpayer is registered of
13 
required to register].”
14
15 
SEC. 20. Section 115 of the National Internal Revenue Code of 1997,
16 
as amended, is hereby amended to read as follows:
17 
"SEC. 115. Power of the Commissioner to Suspend the
18 
Business Operations of a Taxpayer. — The Commissioner or his
19 
authorized representative is hereby empowered to suspend the
20 
business operations and temporarily close the business
21 
establishment of any person for any of the following violations:
22 
{d) In the case of a VAT-registered Person. —
23 
(1) Failure to issue [receipts or] invoices;
15


1 
(2) Failure to file a value-added tax return as required
2 
under Section 114; or
3 
(3) Understatement of taxable sales [or- receipts] by
4 
thirty percent (30%) or more of his correct taxable sales [er
5 
receipts] for the taxable quarter.
6
7 
SEC. 21. Section 116 of the National Internal Revenue Code of 1997, as
8 
amended, is hereby further amended to read as follows:
9 
"SEC. 116. Tax on Persons Exempt from Value-Added Tax
10 
(VAT). -Any person whose sales [or receipts] are exempt under
11 
Section 109 (BB) of this Code from the payment of value-added
12 
tax and who is not a VAT-registered person shall pay EITHER
13 
PERSONALLY OR ELECTRONICALLY, a tax equivalent to
14 
three percent (3%) of his gross quarterly sales [or receipts];
15 
Provided, That cooperatives, shall be exempt from the three
16 
percent (3%) gross receipts tax herein imposed."
17
18 
SEC. 22. Section 117 of the National Internal Revenue Code of 1997,
19 
as amended, is hereby further amended to read as follows:
20 
SEC. 117. Percentage Tax on Domestic Carriers and Keepers of
21 
Garages. — Cars for rent or hire driven by the lessee; transportation
22 
contractors, including persons who transport passengers for hire, and
23 
other domestic carriers by land for the transport of passengers (except
24 
owners of bancas and owners of animal-drawn two wheeled vehicle),
25 
and keepers of garages shall pay a tax equivalent to three percent (3%)
26 
of their quarterly gross [receipts] SALES. The gross [receipts]
16


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7
SALES of common carriers derived from their incoming and outgoing 
freight shall not be subjected to the local taxes imposed under Republic 
Act No. 7160, otherwise known as the Local Government Code of 1991.
[In computing the pGreontago tax provided in this 
Section, the following shall bo considorod the minimum
quarterly gross receipts in each particular case;
Jeepney-for hire
Manila and other cities
P2t4QQ
Provincial
Public utitity bus
Not exceeding 30 passengers
P3>SOQ
Exceeding 30 but not exceeding 50
passengers
6/000
Exceeding 50 passengers
7/200
Taxis
Manila and other cities
P3/600
Provincial
2/400
10
Car for hire (witb chauffeur)
P3,000
Car for hire (without chauffeur)
1,800]
11
12
13
14
15
16
17
18
SEC. 23. Section 118 of the National Internal Revenue Code of 1997, as 
amended, is hereby further amended to read as follows:
SEC. 118. Percentage Tax on International Carriers. —
(A) International air carriers doing business in the Philippines on 
their gross [receipts] SALES derived from transport of cargo from the 
Philippines to another country shall pay a tax of three percent (3%) of 
their quarterly gross receipts.
17


1 
(B) International shipping carriers doing business in the
2 
Philippines on their gross [receipts] SALES derived from transport of
3 
cargo from the Philippines to another country shall pay a tax equivalent
4 
to three percent (3%) of their quarterly gross [receipts] SALES.
5
6 
SEC. 24. Section 119 of the National Internal Revenue Code of 1997, as
7 
amended, is hereby further amended to read as follows:
8 
SEC. 119. Tax on Franchises. — Any provision of general or
9 
special law to the contrary notwithstanding, there shall be levied,
10 
assessed and collected in respect to all franchises on radio and/or
11 
television broadcasting companies whose annual gross [receipts]
12 
SALES of the preceding year do not exceed Ten million pesos
13 
(P10,000,000), subject to Section 236 of this Code, a tax of three percent
14 
(3%) and on gas and water utilities, a tax of two percent (2%) on the
15 
gross [receipts] SALES derived from the business covered by the law
16 
granting the franchise: Provided, however, That radio and television
17 
broadcasting companies referred to in this Section shall have an option
18 
to be registered as a value-added taxpayer and pay the tax due thereon:
19 
Provided, further. That once the option is exercised, said option shall be
20 
irrevocable.
21 
XXX
22
23 
SEC. 25. Section 120 of the National Internal Revenue Code of 1997,
24 
as amended, is hereby further amended to read as follows:
25 
SEC. 120. Tax on Overseas Dispatch, Message or Conversation
26 
Originating from the Phiiippines. —
27 
(A) Persons Liable. — There shall be collected upon every
28 
overseas dispatch, message or conversation transmitted from the
29 
Philippines by telephone, telegraph, telewriter exchange, wireless
30 
and other communication equipment services, a tax of ten
31 
percent (10%) on the amount [paid] PAYABLE for such
32 
services. The tax imposed in this Section shall be payable by the
18


1 
person paying for the services rendered and shall be paid to the
2 
person rendering the services who is required to collect and pay
3 
the tax within twenty (20) days after the end of each quarter.
4 
XXX
5
6 
SEC. 26. Section 128 of the National Internal Revenue Code of 1997, as
7 
amended, Is hereby amended to read as follows:
8 
"SEC. 128. Returns and Payment of Percentage Taxes. -
9 
(A) Returns of Gross Sales, Receipts or Earnings and
10 
Payment of Tax. -
11 
(1) Persons Liable to Pay Percentage Taxes. - Every person
12 
subject to the percentage taxes imposed under this Title shall file,
13 
EITHER PERSONALLY OR ELECTRONICALLY, a quarterly
14 
return of the amount of [his] THE PERSON'S gross sales,
15 
receipts or earnings and pay, EITHER PERSONALLY OR
16 
ELECTRONICALLY, the tax due thereon within twenty-five (25)
17 
days after the end of each taxable quarter: Provided, That in the
18 
case of a person whose VAT registration is cancelled and who
19 
becomes liable to the tax imposed in Section 116 of this Code,
20 
the tax shall accrue from the date of cancellation and shall be
21 
paid in accordance with the provisions of this Section.
22 
(2) Person Retiring from Business. - Any person retiring
23 
from a business subject to percentage tax shall notify the nearest
24 
internal revenue officer, file, EITHER PERSONALLY OR
25 
ELECTRONICALLY, [h«] THE PERSON'S return and pay.
19


1 
EITHER PERSONALLY OR ELECTRONICALLY, the tax due
2 
thereon within twenty (20) days after closing [his] THE business.
3 
XXX
4 
(B) Where to File. - Except as the Commissioner
5 
otherwise permits, every person liable to the
6 
percentage tax under this Title [may, at his option,]
7 
SHALL file EITHER PERSONALLY OR
8 
ELECTRONICALLY, a [separate return for each
9 
branch or place of business, or] consolidated
10 
return for all branches or places of business with [the]
11 
ANY [authorized agent bank] AAB, Revenue
12 
District Officer, OR Collection Agent [or duly
13 
authorized Treasurer of the city or municipality
14 
whore said business or principal place of
15 
business is located, as the case may be]."
16
17 
SEC. 27. Section 200 of the National Internal Revenue Code of 1997, as
18 
amended, is hereby amended to read as follows:
19 
"SEC. 200. Payment of Documentary Stamp Tax. -
20 
(A) In General. - The provisions of Presidential Decree No.
21 
1045 notwithstanding, any person liable 
to pay documentary
22 
stamp tax upon any document subject to tax under Title VII of
23 
this Code shall 
file, EITHER 
PERSONALLY OR
24 
ELECTRONICALLY, 
a tax return 
and pay, EITHER
20


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3
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6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
PERSONALLY OR ELECTRONICALLY, the tax in accordance 
with the rules and regulations to be prescribed by the Secretary 
of Finance, upon recommendation of the Commissioner.
(B) Time for Filing and Payment of the Tax. - Except as 
provided by rules and regulations promulgated by the Secretary 
of Finance, upon recommendation of the Commissioner, the tax 
return prescribed in this Section shall be filed, EITHER 
PERSONALLY OR ELECTRONICALLY, within ten (10) days 
after the close of the month when the taxable document was 
made, signed, issued, accepted, or transferred, and the tax 
thereon shall be paid, EITHER PERSONALLY OR 
ELECTRONICALLY, at the same time the aforesaid return is 
filed.
(C) Where to Hie. - Except in cases where the 
Commissioner otherwise permits, the aforesaid tax return shall 
be filed EITHER PERSONALLY OR ELECTRONICALLY, with 
and the tax due shall be paid EITHER PERSONALLY OR 
ELECTRONICALLY, through [the] ANY authorized agent bank 
[within the territorial jurisdiction of the Revenue District
Office which has jurisdiction over the rcsidGncc or
principal place of business of the taxpayer]. In places 
where there is no [authorized agent bank] AAB, the return 
shall be filed with [the] A Revenue District Officer [7] OR 
collection agent [, or duly authorized Treasurer of the city
21


1 
or--municipality in-which the taxpayer has- his-4egai
2 
residence or principal place of business].
3
4 
SEC. 28. Section 236 of the National Internal Revenue Code of 1997, as
5 
amended, is hereby further amended to read as follows:
6 
"SEC. 236. Registration Requirements. -
1 
(A) Requirements. - Every person subject to any internal
8 
revenue tax shall register once with the appropriate Revenue District
9 
Officer OR THROUGH ELECTRONIC MEANS:
10 
(1) Within ten (10) days from date of employment, or
11 
(2) On or before the commencement of business, or
12 
(3) Before payment of any tax due, or
13 
(4) Upon filing of a return, statement or declaration as
14 
required in this Code.
15 
The registration shall contain the taxpayer's name,
16 
[styteJ place residence, business, and such other information
17 
as may be required by the Commissioner in the form prescribed
18 
therefor: Provided, THAT THE COMMISSIONER SHALL
19 
ENSURE THE AVAILABILITY OF REGISTRATION
20 
FACILITIES TO TAXPAYERS WHO ARE NOT RESIDING IN
21 
THE COUNTRY: PROVIDED, FURTHER, That the
22 
Commissioner shall simplify the business registration and tax
23 
compliance requirements of self-employed individuals and/or
24 
professionals.
22


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2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22 
23
XXX
[f&3—Annual Registration Fee.-------An—annual
registration fee in the amount of Five hundred pesos
(PhPBOO) for Gvory separate or distinct establishment or
place of business^ including facility types whore sales
transactions occur/ shall be paid upon registration and
every year thereafter on er-before the last day of January!
Provided,—however,—That—cooperativos/—individuals
ear-fting purely compensation income^ whether locally or
abreadT-'-and overseas -workers are not liable to the
registration foe heroin imposed.
The registration fee shall bo paid to an authorized 
agent bank located within the revenue district^ or to the
Revenue Collection Officer^ or duly authorized Treasurer
of the city or municipality-whore each place-of business
or branch is registered.]
[(€}] (B) Registration of Each Type of Internai Revenue 
Tax. - Every person who is required to register with the Bureau 
of Internal Revenue under Subsection (A) hereof, shall register 
each type of internal revenue tax for which he is obligated, shall
file, EITHER PERSONALLY OR ELECTRONICALLY, a return 
and shall pay, EITHER PERSONALLY OR 
ELECTRONICALLY, such taxes, and shall updates such
23


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2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22 
23
registration of any changes in accordance with Subsection (E) 
hereof.
[fD}] (C) Transfer of Registration. - In case a 
registered person decides to transfer [Ws] THE place of 
business or [his] head office or branches, it shall be [his] THE 
PERSON'S duty to update [his] THE registration status by 
filing, EITHER PERSONALLY OR ELECTRONICALLY, an 
application for registration information update in the form 
prescribed therefor.
m] (D) other Updates. - x x x
(E) Cancellation of Registration. - x x x
(1) General Rule. - The registration of any person 
who ceases to be liable to a tax type shall be cancelled 
upon MERE filing with the Revenue District Office where 
he is registered OR THROUGH ELECTRONIC MEANS, 
an application for registration information update in a form 
prescribed therefor[;]. HOWEVER, THIS SHALL NOT 
PRECLUDE THE REVENUE DISTRICT OFFICER 
FROM CONDUCTING AN AUDIT IN ORDER TO 
DETERMINE ANY TAX LIABILITY.
(2) Cancellation of Value-Added Tax Registration. - 
A VAT- registered person may cancel [his] THE 
registration for VAT if:
24


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2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
(a) [He] THE PERSON makes A written OR AN 
ELECTRONIC application and can demonstrate to the 
Commissioner's satisfaction that [his] THE gross sales or 
receipts for the following twelve (12) months, other than 
those that are exempt under Section 109 (A) to ([U]CC), 
will not exceed [One million five hundred thousand 
pesos (Pl,500,000)] THREE MILLION PESOS 
(P3/000/000) or
(b) [He] THE PERSON has ceased to carry on 
[his] THE trade or business, and does not expect to 
recommence any trade or business within the next (12) 
months.
The cancellation of registration will be effective 
from the first day of the following month.
[(G)] (F) Persons Required to Register for Value-Added 
Tax. —
(1) Any person who, in the course of trade or 
business, sells, barters or exchanges goods or properties, 
or engages in the sale or exchange of services, shall be 
liable to register, EITHER PERSONALLY OR 
ELECTRONICALLY, for value-added tax if:
(a) [His] THE PERSON'S gross sales or receipts 
for the past twelve (12) months, other than those that are 
exempt under Section 109(A) to (BB), have exceeded THE
25


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3
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7
8 
9
10
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12
13
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20 
21 
22
23
24
THRESHOLD AS PROVIDED IN SECTION 109 
(CC)[ThrGG million pesos (P3/000f000)];
(b) There are reasonable grounds to believe that 
[his] THE gross sales or receipts for the next twelve (12) 
months, other than those that are exempt under Section 
109(A) to (BB), will exceed THE THRESHOLD AS 
PROVIDED IN SECTION 109 (CC)[Three million 
pesos (P3/000,000)].
(2) Every person who becomes liable to be 
registered under paragraph (1) of this Subsection shall 
register, EITHER PERSONALLY OR 
ELECTRONICALLY, with the Revenue District Office 
which has jurisdiction over the head office or branch of 
that person, and shall pay, EITHER PERSONALLY OR 
ELECTRONICALLY, the annual registration fee 
prescribed in Subsection (B) hereof. If he fails to register, 
he shall be liable to pay the tax under Title IV as if he were 
a VAT-registered person, but without the benefit of input 
tax credits for the period in which he was not properly 
registered.
[(H)] (G) Optional Registration for Value-Added Tax of 
Exempt Person. -
(1) Any person who is not required to register for 
value-added tax under Subsection [(G)] (F) hereof may
26


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2
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7
8 
9
10
11
12
13
14
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22 
23
elect to register, EITHER PERSONALLY OR 
ELECTRONICALLY, for value-added tax [by 
registering] with the Revenue District Office that has a 
jurisdiction over the head office of that person. [, and
paying the annual registration fee in Subsection (B)
hereof.]
(2) Any person who elects to register under this 
Subsection shall not be entitled to cancel his registration 
under Subsection [^] (E)(2) for the next three (3) years.
XXX
[fl}] (H) Supplying of Taxpayer Identification Number 
(TIN). -
Any person required under the authority of this Code 
to make, render or file a return, statement or other 
document shall be supplied with or assigned a Taxpayer 
Identification Number (TIN) which [he] THE PERSON 
shall indicate in such return, statement or document filed, 
EITHER PERSONALLY OR ELECTRONICALLY, with 
the Bureau of Internal Revenue for [his] proper 
identification for tax purposes, and which [he] THE 
PERSON shall indicate in certain documents, such as, but 
not limited to the following:
XXX
27


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2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
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18
21
22
23
24
In cases where a registered taxpayer dies, the 
administrator or executor shall register, EITHER 
PERSONALLY OR ELECTRONICALLY, the estate of the 
decedent in accordance with Subsection (A) hereof and a 
new Taxpayer Identification Number (TIN) shall be 
supplied in accordance with the provisions of this Section.
In the case of a nonresident decedent, the executor 
or administrator of the estate shall register, EITHER 
PERSONALLY OR ELECTRONICALLY, the estate with 
the Revenue District Office where [he] THE EXECUTOR 
OR ADMINISTRATOR is registered: Provided, however, 
That in case such executor or administrator is not 
registered, registration of the estate shall be made with 
the Taxpayer Identification Number (TIN) supplied by the 
Revenue District Office having jurisdiction over his legal 
residence.
X X x"
19 
SEC. 29. Section 237 of the National Internal Revenue Code of 1997,
20 
as amended, is hereby further amended to read as follows:
"SEC. 237. Issuance of Receipts or Sales or Commercial Invoices.
(A) Issuance. — All persons subject to an internal revenue 
tax shall, at the point of each sale and transfer of merchandise or
28


1 
for services rendered valued at One hundred pesos (PhPlOO.OO)
2 
or more, issue duly registered receipts or sale or commercial
3 
invoices, showing the date of transaction, quantity, unit cost and
4 
description of merchandise or nature of service: Provided,
5 
however. That where the receipt is issued to cover payment made
6 
as rentals, commissions, compensation or fees, receipts or
7 
invoices shall be issued which shall show the name, [business
8 
stylo, if any,] and address of the purchaser, customer or client:
9 
Provided, further. That where the purchaser is a VAT-registered
10 
person, in addition to the information herein required, the invoice
11 
or receipt shall further show the Taxpayer Identification Number
12 
(TIN) of the purchaser.
13 
xxx"
14
15 
SEC. 30. Section 245 of the National Internal Revenue Code of 1997, as
16 
amended, is hereby amended to read as follows:
17 
"SEC. 245. Specific Provisions to be Contained in Ruies and
18 
Reguiations. — The rules and regulations of the Bureau of
19 
Internal Revenue shall, among other things, contain provisions
20 
specifying, prescribing or defining:
21 
xxx
22 
"O The manner in which internal revenue taxes, such as
23 
income tax, including withholding tax, estate and donor's taxes,
24 
value-added tax, other percentage taxes, excise taxes and
29


1 
documentary stamp taxes shall be paid, EITHER PERSONALLY
2 
OR ELECTRONICALLY, through the collection officers of the
3 
Bureau of Internal Revenue or through duly authorized agent
4 
banks which are hereby deputized to receive payments of such
5 
taxes and the returns, papers and statements that may be filed
6 
by the taxpayers in connection with the payment of the tax:
7 
Provided, however, That notwithstanding the other provisions of
8 
this Code prescribing the place of filing of returns and payment
9 
of taxes, the Commissioner may, by rules and regulations, require
10 
that the tax returns, papers and statements and taxes of large
11 
taxpayers be filed and paid, respectively, through collection
12 
officers or through duly authorized agent banks: Provided,
13 
further. That the Commissioner can exercise this power within six
14 
(6) years from the approval of Republic Act No. 7646 or the
15 
completion of its comprehensive computerization program,
16 
whichever comes earlier: Provided, finally. That separate venues
17 
for the Luzon, Visayas and Mindanao areas may be designated
18 
for the filing of tax returns and payment of taxes by said large
19 
taxpayers.
20 
XXX
21
22 
SEC. 31. Section 248 of the National Internal Revenue Code of 1997,
23 
as amended, is hereby amended to read as follows:
24 
"SEC. 248. Civil Penalties. -
30


1 
(A) There shall be imposed, in addition to the tax
2 
required to be paid, a penalty equivalent to twenty-five percent
3 
(25%) of the amount due, in the following cases:
4 
(1) Failure to file any return and pay the tax due thereon
5 
as required under the provisions of this Code or rules and
6 
regulations on the date prescribed; or
7 
[{3)—Unless—otherwise—authorized—by—the
8 
Commissioner, filing a return with an internal
9 
revenue- officer other than those- with whom the
10 
return is required to be filed;]
11 
(2) Failure to pay the deficiency tax within the time
12 
prescribed for its payment in the notice of assessment; or
13 
[{4}] (3) Failure to pay the full or part of the amount of
14 
tax shown on any return required to be filed under the
15 
provisions of this Code or rules and regulations, or the full
16 
amount of tax due for which no return is required to be
17 
filed, on or before the date prescribed for its payment.
18 
XXX
19
20 
SEC. 32. Implementing Rules and Regulations. - Within ninety (90)
21 
calendar days from the effectivity of this act, the Secretary of Finance, after
22 
due consultation with the Bureau of Internal Revenue, Bureau of Customs, and
23 
the private sector, shall promulgate the necessary rules and regulations for its
24 
effective implementation.
31


2 
SEC. 33. Separability Clause. - If any provision of this Act is declared
3 
unconstitutional, the remaining parts or provision not affected thereby shall
4 
remain in full force and effect.
6
7
8 
9
10
13
14
SEC. 34. Repealing Clause. - All laws, decrees, executive orders, 
implementing rules and regulations, issuances, or any part thereof inconsistent 
with the provisions of this Act are deemed repealed, amended or modified 
accordingly.
11 
SEC. 35. Effectivity. - This Act shall take effect fifteen (15) days after
12 
its publication in the Official Gazette or in a newspaper of general circulation.
Approved,
32