Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
Second Regular Session

HOUSE BILL No. 7653

Introduced by Bayan Muna Rep. CARLOS ISAGANI T. ZARATE, ACT Teachers
Partylist Rep. ANTONIO L. TINIO, Gabriela Women’s Party Rep. EMMI A. DE
JESUS, ACT Teachers Partylist Rep. FRANCE L. CASTRO, Gabriela Women’s Party
Rep. ARLENE D. BROSAS, Anakapawis Rep. ARIEL B. CASILAO, and Kabataan
Partylist Rep. SARAH JANE L ELAGO

AN ACT REVERSING REGRESSIVE AND ANTI-POOR TAXATION, REPEAL]
FOR THE PURPOSE CERTAIN SECTIONS OF REPUBLIC ACT 10963
OTHERWISE KNOWN AS TAX REFORM FOR ACCELERATION AND
INCLUSION ACT

EXPLANATORY NOTE

On January 1, 2018, Republic Act 10963 or the Tax Reform for Acceleration and Inclusion
(TRAIN) Law was implemented.

In the first few months of the implementation of TRAIN Law, prices of petroleum products
rose, and prices of basic goods and service followed suit. Rice, which is supposed to be VAT
exempt, became more expensive by P1-2 per kilo, according to the Kilusang Magbubukid ng
Pilipinas. There was a P10 increase per kilo for beef, meat and pork lean meat and P2 to P20
per kilo increase for dressed chicken.

Fares for Uber and Grab taxis have increased, and fare hikes for public utility jeepneys and
buses are in the offing. Electricity charges increased by February 2018.

The Department of Economic Research of the Bangko Sentral ng Pilipinas sige on April
2018 inflation may reach 4.7%, while the Philippine Statistcics office reported an inflation rate
of 45% in March, higher from the revised 3.8% in February. Earlier, according to news reports,
inflation hit successive 3-year highs of 4% and 4.5% in January and February this year,
coinciding with the initial implementation of the TRAIN law.

Citing the data from the PSA, dean of University of the Philippines (UP) Diliman School of
Statistics Dennis Mapa said that the tax reform law has both direct and indirect effects on the


cost of goods, with price hikes "particularly felt by the poor during the start of the year." He
said that current cash transfers of P200 per family per month may not be enough.!

Yet, the Department of Finance on March 4 said that except for sugar-sweetened beverages
TRAIN had no impact on inflation.

The impact of TRAIN among the poor Filipinos could never be denied, While the TRAIN law
provides higher income tax exemption for those earning below P250,000 annually, it actually
levies higher tax burden to the poor majority with the removal of some VAT exemptions and
introduction of new excise taxes on petroleum products and sugar-sweetened beverages.

‘According to IBON Databank, 60% poorest families or some 13.7 million families will have
decreased income while those in the upper 40% or the the rich and high income group
comprising some 9.1 million families will have higher take home pay.

Some 15.2 million families who earn minimum wages or below belong to the informal sector
who are already exempted from paying income taxes will not benefit from income tax cuts.
But these poor families is actually shouldering the higher cost of goods and services as a result
of the TRAIN Law.

The TRAIN Law contradicts a progressive and pro-poor taxation. The aim to lower taxes for
the poor and improve the quality of life of our people was negated by the government's drive
to increase revenues. Instead of easing the burden of over-taxation, the TRAIN Law worsens
the misery of our people.

Instead of heavily taxing the poor through VAT and excise taxes on petroleum products and
sugar-sweetened beverages, higher taxes should be levied on those who have more capacity, in
our case, the big foreign and local corporations and landlords. The poor and low-income
families, on the other hand, should be taxed as lightly as possible while provided with the much
needed publicly-provided social and economic services.

This bill aims to reduce the tax burden on the poor majority by amending the TRAIN Law. It
repeals regressive taxes including the expansion of VAT coverage, additional excise taxes on
petroleum products and the excise taxes on sugar-sweetened beverages.

Passage of this urgent bill is eamestly sought.

Approved,

if

;
Bayan Mufa Partylist

+ https://www.rappler.com/business/197390- inflation-poor-filipinos-tax-reform-poverty-reduction
2


Rep. ANTONIO L. TINIO
ACT Teachers Partylist

Rep. FRANCE L. CASTRO
ACT Teachers Partylist

Rep. ARIEL B. CASILAO
Anakpawis Partylist

Rep. EMMI A. DE JESUS
Gabriela Women’s Party

er
Ri D. BROSAS
fabriel¢ Women's Party

Rep. SARAH JANE I. ELAGO
Kabataan Partylist


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
Second Regular Session

HOUSE BILL No. 7653

Introduced by Reps. CARLOS ISAGANI T. ZARATE, ANTONIO L. TINIO,
EMMI A. DE JESUS, FRANCE L. CASTRO, ARLENE D. BROSAS,
ARIEL B. CASILAO, and SARAH JANE L ELAGO

AN ACT REVERSING REGRESSIVE AND ANTI-POOR TAXATION, REPEALIN
FOR THE PURPOSE CERTAIN SECTIONS OF REPUBLIC ACT 10963
OTHERWISE KNOWN AS TAX REFORM FOR ACCELERATION AND
INCLUSION ACT

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

SECTION 1. Section 12 of Republic Act 10963 otherwise known as the Tax Reform for
Acceleration and Inclusion Act is hereby amended to read as follows:

“SEC. 12 [Section 35 of the NIRC, as amended, is hereby repealed] ALLOWANCE
OF PERSONAL EXEMPTION FOR INDIVIDUAL TAXPAYER. -

(A) IN GENERAL. - FOR PURPOSES OF DETERMINING THE TAX
PROVIDED IN SECTION 24 (A) OF THIS TITLE, THERE SHALL BE
ALLOWED A BASIC PERSONAL EXEMPTION AMOUNTING TO FIFTY
THOUSAND PESOS (P50,000) FOR EACH INDIVIDUAL TAXPAYER.

IN THE CASE OF MARRIED INDIVIDUALS WHERE ONLY ONE OF THE
SPOUSES IS DERIVING GROSS INCOME, ONLY SUCH SPOUSE SHALL
BE ALLOWED THE PERSONAL EXEMPTION.

(B) ADDITIONAL EXEMPTION FOR DEPENDENTS. - THERE SHALL BE
ALLOWED AN ADDITIONAL EXEMPTION OF TWENTY-FIVE
THOUSAND PESOS (P25,000) FOR EACH DEPENDE! jOT EXCEEDING
FOUR (4).

THE ADDITIONAL EXEMPTION FOR DEPENDENT SHALL BE CLAIMED
BY ONLY ONE OF THE SPOUSES IN THE CASE OF MARRIED
INDIVIDUALS.

IN THE CASE OF LEGALLY SEPARATED SPOUSES, ADDITIONAL
EXEMPTIONS MAY BE CLAIMED ONLY BY THE SPOUSE WHO HAS
CUSTODY OF THE CHILD OR CHILDREN: PROVIDED, THAT THE
TOTAL AMOUNT OF ADDITIONAL EXEMPTIONS THAT MAY BE

4


CLAIMED BY BOTH SHALL NOT EXCEED THE MAXIMUM
ADDITIONAL EXEMPTIONS HEREIN ALLOWED.

FOR PURPOSES OF THIS SUBSECTION, A ‘DEPENDENT MEANS A
LEGITIMATE, ILLEGITIMATE OR LEGALLY ADOPTED CHILD
CHIEFLY DEPENDENT UPON AND LIVING WITH THE TAXPAYER IF
SUCH DEPENDENT IS NOT MORE THAN TWENTY-ONE (21) YEARS OF
AGE, UNMARRIED AND NOT GAINFULLY EMPLOYED OR IF SUCH
DEPENDENT, REGARDLESS OF AGE, IS INCAPABLE OF SELF-SUPPORT
BECAUSE OF MENTAL OR PHYSICAL DEFECT.

(C) CHANGE OF STATUS. - IF THE TAXPAYER MARRIES OR SHOULD
HAVE ADDITIONAL DEPENDENT(S) AS DEFINED ABOVE DURING THE
TAXABLE YEAR, THE TAXPAYER MAY CLAIM THE CORRESPONDING
ADDITIONAL EXEMPTION, AS THE CASE MAY BE, IN FULL FOR SUCH
YEAR.

IF THE TAXPAYER DIES DURING THE TAXABLE YEAR, HIS ESTATE
MAY STILL CLAIM THE PERSONAL AND ADDITIONAL EXEMPTIONS
FOR HIMSELF AND HIS DEPENDENT(S) AS IF HE DIED AT THE CLOSE
OF SUCH YEAR.

IF THE SPOUSE OR ANY OF THE DEPENDENTS DIES OR IF ANY OF
SUCH DEPENDENTS MARRIES, BECOMES TWENTY-ONE (21) YEARS
OLD OR BECOMES GAINFULLY EMPLOYED DURING THE TAXABLE
YEAR, THE TAXPAYER MAY STILL CLAIM THE SAME EXEMPTIONS
AS IF THE SPOUSE OR ANY OF THE DEPENDENTS DIED, OR AS IF
SUCH DEPENDENTS MARRIED, BECAME TWENTY-ONE (21) YEARS
OLD OR BECAME GAINFULLY EMPLOYED AT THE CLOSE OF SUCH
YEAR.

(D) PERSONAL EXEMPTION ALLOWABLE TO NONRESIDENT ALIEN
INDIVIDUAL. - A NONRESIDENT IEN INDIVIDUAL ENGAGED IN
TRADE, BUSINESS OR IN THE EXERCISE OF A PROFESSION IN THE
PHILIPPINES SHALL BE ENTITLED TO A PERSONAL EXEMPTION
THE AMOUNT EQUAL TO THE EXEMPTIONS ALLOWED IN THE
INCOME TAX LAW IN THE COUNTRY OF WHICH HE IS A SUBJECT -
OR CITIZEN, TO CITIZENS OF THE PHILIPPINES NOT RESIDING IN
SUCH COUNTRY, NOT TO EXCEED THE AMOUNT FIXED IN THIS
SECTION AS EXEMPTION FOR CITIZENS OR RESIDENT OF THE
PHILIPPINES: PROVIDED, THAT SAID NONRESIDENT ALIEN SHOULD
FILE A TRUE AND ACCURATE RETURN OF THE TOTAL INCOME
RECEIVED BY HIM FROM ALL SOURCES IN THE PHILIPPINES, AS
REQUIRED BY THIS TITLE.”

SECTION 2. Section 33 of the same Act is hereby amended to read as follows:

“SEC. 33. Section 108 of the NIRC, 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 percent (12%) of gross receipts derived
from the sale or exchange of services, including the use or lease of properties.

‘The phrase "sale or exchange of services" means the performance of all kinds
or services in the Philippines for others for a fee, remuneration or
consideration, including those performed or rendered by construction and
service contractors; stock, real estate, commercial, customs and immigration
brokers; lessors of property, whether personal or real; warehousing services;
lessors or distributors of cinematographic films; persons engaged in milling
processing, manufacturing or repacking goods for others; proprietors,
‘operators or keepers of hotels, motels, resthouses, pension houses, inns,
Tesorts; proprietors or operators of restaurants, refreshment parlors, cafes and
other eating places, including clubs and caterers; dealers in securities; lending
investors; transportation contractors on their transport of goods or cargoes,
including persons who transport goods or cargoes for hire another domestic
‘common carriers by land relative to their transport of goods or cargoes;
‘common carriers by air and sea relative to their transport of passengers, goods
‘or cargoes from one place in the Philippines to another place in the
Philippines; [sales of electricity by generation companies, transmission by any
entity, and distribution companies including electric cooperatives] services of
franchise grantees of telephone and telegraph, radio and television
broadcasting and all other franchise grantees except those under Section 119
of this Code; services of banks, non-bank financial intermediaries and finance
companies; and non-life insurance companies (except their crop insurances),
including surety, fidelity, indemnity and bonding companies; and similar
services regardless of whether or not the performance thereof calls for the
exercise or use of the physical or mental faculties. The phrase "sale or
exchange of services" shall likewise include:

“(1) The lease or the use of or the right or privilege to use any copyright,
patent, design or model, plan secret formula or process, goodwill, trademark,
trade brand or other like property or right;

“(2) The lease of the use of, or the right to use of any industrial, commercial or
scientific equipment;

“(3) The supply of scientific, technical, industrial or commercial knowledge or
information;

“(4) The supply of any assistance that is ancillary and subsidiary to and is
furnished as a means of enabling the application or enjoyment of any such
property, or right as is mentioned in subparagraph (2) or any such knowledge
or information as is mentioned in subparagraph (3);


“(5) The supply of services by a nonresident person or his employee in
connection with the use of property or rights belonging to, or the installation
or operation of any brand, machinery or other apparatus purchased from such
nonresident person.

“(6) The supply of technical advice, assistance or services rendered in
connection with technical management or administration of any scientific,
industrial or commercial undertaking, venture, project or scheme;

“(7) The lease of motion picture films, films, tapes and discs; and

“(8) The lease or the use of or the right to use radio, television, satellite
transmission and cable television time.

“Lease of properties shall be subject to the tax herein imposed irrespective of
the place where the contract of lease or licensing agreement was executed if
the property is leased or used in the Philippines.

“The term ‘gross receipts’ means the total amount of money or its equivalent
representing the contract price, compensation, service fee, rental or royalty,
including the amount charged for materials supplied with the services and
deposits and advanced payments actually or constructively received during the
taxable quarter for the services performed or to be performed for another
person, excluding value-added tax.

“(B) xxx

“(1) xxx

(2) xxx

(3) xxx

“(4) xxx

(5) xxx

“(6) xxx

“(7) xxx

“Provided that, subparagraphs (B)(1) and (B)(S) hereof shall be subject to the
twelve percent (12%) value-added tax and no longer be subject to zero percent
(0%) VAT rate upon satisfaction of the following conditions:

“(1) xxx

“(2) xxx


SECTION 3. Section 34 of the Same Act shall be 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:

“(A) xxx

“(B) xxx
“(C) xxx
“(D) xxx
“(E) xxx
“(F) xxx

“(G) xxx
“(H) xxx
“(D) xxx

“() xxx

“(K) xxx
“(L) xxx
“(M) xxx
“(N) xxx
“(O) xxx

“(P) Sale of real properties not primarily held for sale to customers or 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 beginning January 1, 2021, the VAT exemption

shall only apply to sale of real properties not primarily held for sale to customers or
held for lease in the ordinary course of trade or business, sale of real property utilized

for socialized housing as defined by Republic Act No. 7279, sale of house and lot,

and other residential with selling price of not more than Two million pesos (P2, 000,

000) and below:] Provided, [further,] That 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 Philippine Statistics Authority (PSA);

“Q xx

“(R) xxx

“(S) xxx

“(T) xxx


“(U) xxx
S(V) xxx
“(W) xxx
“(X) xxx
“(Y) xxx
“(Z) xxx
“(AA) xxx
“(BB) xxx
SECTION 4. Section 38 of the same Act is hereby amended to read as follows:

“SEC. 38. Section 116 of the NIRC, as amended, is hereby further amended to read as
follows:

“SEC. 116. TAX ON PERSONS EXEMPT FROM VALUE-ADDED TAX
(VAT). - ANY PERSON WHOSE SALES OR RECEIPTS ARE
EXEMPT UNDER SECTION 109 (BB) OF THIS CODE FROM THE
PAYMENT OF VALUE-ADDED TAX AND WHO IS NOT A VAT-
REGISTERED PERSON SHALL PAY A TAX EQUIVALENT TO
THREE PERCENT (3%) OF HIS GROSS QUARTERLY SALES OR
RECEIPTS: PROVIDED, THAT COOPERATIVES, AND BEGINNING
JANUARY 1, 2019 SELF-EMPLOYED AND PROFESSIONALS WITH
TOTAL ANNUAL GROSS SALES AND/OR GROSS RECEIPTS NOT
EXCEEDING TWO MILLION (P2,000,000) SHALL BE EXEMPT
FROM THE THREE PERCENT (3%) GROSS RECEIPTS TAX
HEREIN IMPOSED.”

SECTION 5. Section 43 of the same Act is hereby amended to read as follows:

“SEC. 43. Section 148 of the NIRC, as amended, is hereby further amended to read as
follows:

“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 January 1, 2018]

“(a) Lubricating oils and greases, including but not limited to, base stock 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, [Eight pesos (P8.00)] FOUR PESOS AND

9


FIFTY CENTAVOS (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
base stocks 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,
refined or recycled shall likewise be subject to the tax imposed under this
Section.

“(b) Processed gas, per liter of volume capacity, [Eight pesos (P8.00)] FIVE
CENTAVOS (P0.05);

“(c) Waxes and petrolatum, per kilogram, [Eight pesos (P8.00)] THREE
PESOS AND FIFTY CENTAVOS (P3.50);

“(d) On denatured alcohol to be used for motive power, per liter of volume
capacity, [Eight pesos (8.00)] 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 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;

“(e) Naphtha, regular gasoline and other similar products of distillation, per
liter of volume capacity, [Eight pesos (P8.00)] FOUR PESOS AND
THIRTY CENTAVOS (P4.35): Provided, however, That naphtha, and
pyrolysis gasoline, when used as a raw material in the production of
petrochemical products, or in the refining of petroleum 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
tules 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 production of
petroleum products of distillation and for use solely for the production of
gasoline shall be exempt from excise tax; Provided, finally, 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) Unleaded premium gasoline, per liter of volume capacity, Seven pesos
(P7.00);]

10


“(F) LEADED PREMIUM GASOLINE, PER LITER OF VOLUME
CAPACITY, FIVE PESOS AND THIRTY-FIVE CENTAVOS (P5.35);
UNLEADED PREMIUM GASOLINE, PER LITER OF VOLUME
CAPACITY, FOUR PESOS AND THIRTY-FIVE CENTAVOS (P4.35);

“(g) Aviation turbo jet fuel, per liter of volume capacity, [Four pesos (P4.00)]
THREE PESOS AND SIXTY-SEVEN CENTAVOS (P3.67);

“(h) Kerosene, per liter of volume capacity, [Three pesos (P3.00)] ZERO
(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) Diese! fuel oil, an on similar fuel oils having more or less the same
generating power, per liter of volume capacity, [Two pesos and fifty centavos
(P2.50)] ZERO (P0.00);

“G) Liquefied petroleum gas, per kilogram, [One peso (P1.00)] ZERO
(P0.00): Provided, That liquefied petroleum gas when used as raw material in
the production of petrochemical products, subject to the rules and regulations
to be promulgated by the Secretary of Finance, shall be taxed zero (P0.00) per
kilogram;

Provided, finally, 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, [Eight pesos (P8.00)] FIFTY-SIX CENTAVOS
(P0.56); and

“(1) Bunker fuel oil, and on similar fuel oils having more or less the same
generating power, per liter of volume capacity, [Two pesos and fifty centavos
(P2.50)} ZERO (P0.00);

“(m) Petroleum coke, per metric ton, Two pesos and fifty centavos (P2.50):
Provided, however, That petroleum coke, when used as feedstock to any
power generating facility, per metric ton, zero (P0.00).”

[Effective January 1, 2019

(a) Lubricating oils and greases, including but not limited to, base stock 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, Nine pesos (P9.00): 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 base stocks 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

te


subsequently reprocessed, refined or recycled shall likewise be subject to the
tax imposed under this Section.

(b) Processed gas, per liter of volume capacity, Nine pesos (P9.00);
(c) Waxes and petrolatum, per kilogram, Nine pesos (P9.00);

(d) On denatured alcohol to be used for motive power, per liter of volume
capacity, Nine pesos (P9.00): 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 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;

(e) Naphtha, regular gasoline and other similar products of distillation, per
liter of volume capacity, Nine pesos (P9.00): Provided, however, That
naphtha, and pyrolysis gasoline, when used as a raw material in the production
of petrochemical products, or in the refining of petroleum 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 Finance, per liter
‘of volume capacity, zero (P0.00): Provided, further, That the production of
petroleum products of distillation and for use solely for the production of
gasoline shall be exempt from excise tax; Provided, finally, 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) Unleaded premium gasoline, per liter of volume capacity, Nine pesos
(P9.00),

(g) Aviation turbo jet fuel, per liter of volume capacity, Four pesos (P4.00);

(h) Kerosene, per liter of volume capacity, Four pesos (P4.00): 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, an on similar fuel oils having more or less the same

generating power, per liter of volume capacity, Four pesos and fifty centavos
(P4.50);

12


(j) Liquefied petroleum gas, per kilogram, Two pesos (P2.00): Provided, That
liquefied petroleum gas when used as raw material in the production of
petrochemical products, subject to the rules and regulations to be promulgated
by the Secretary of Finance, shall be taxed zero (P0.00) per kilogram:
Provided, finally, 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, Nine pesos (P9.00);

(1) Bunker fuel oil, and on similar fuel oils having more or less the same
generating power, per liter of volume capacity, Four pesos and fifty centavos
(P4.50); and

(m) Petroleum coke, per metric ton, Four pesos and fifty centavos (P4.50):
Provided, however, That petroleum coke, when used as feedstock to any
power generating facility, per metric ton, zero (P0.00).]

[Effective January 1, 2020

(a) Lubricating oils and greases, including but not limited to, base stock 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 pesos (P10.00): 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 base stocks 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, refined or recycled shall likewise be subject to the
tax imposed under this Section.

(b) Processed gas, per liter of volume capacity, Ten pesos (P10.00);
(c) Waxes and petrolatum, per kilogram, Ten pesos (P 10.00);

(d) On denatured alcohol to be used for motive power, per liter of volume
capacity, Ten pesos (P10,00): 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 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;

(e) Naphtha, regular gasoline and other similar products of distillation, per
liter of volume capacity, Ten pesos (10.00): Provided, however, That naphtha,
and pyrolysis gasoline, when used as a raw material in the production of
petrochemical products, or in the refining of petroleum products, or as.

13


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 Finance, per liter
of volume capacity, zero (P0.00): Provided, further, That the production of
petroleum products of distillation and for use solely for the production of
gasoline shall be exempt from excise tax; Provided, finally, 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) Unleaded premium gasoline, per liter of volume capacity, Ten pesos
(P10.00);

(g) Aviation turbo jet fuel, per liter of volume capacity, Four pesos (P4.00);

(h) Kerosene, per liter of volume capacity, Five pesos (P5.00): 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, an on similar fuel oils having more or less the same
generating power, per liter of volume capacity, Six pesos (P6.00),

(j) Liquefied petroleum gas, per kilogram, Three pesos (P3.00): Provided,
‘That liquefied petroleum gas when used as raw material in the production of
petrochemical products, subject to the rules and regulations to be promulgated
by the Secretary of Finance, shall be taxed zero (P0.00) per kilogram:
Provided, finally, 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, Ten pesos (P10.00);

(1) Bunker fuel oil, and on similar fuel oils having more or less the same
generating power, per liter of volume capacity, Six pesos (P6.00); and

(m) Petroleum coke, per metric ton, Six pesos (P6.00): Provided, however,
That petroleum coke, when used as feedstock to any power generating facility,
per metric ton, zero (PO.00).]

SECTION 6. Section 47 of the same Act is hereby repealed.

SECTION 7. Section 82 of the same Act is hereby repealed.

SECTION 8. Repealing Clause. — All laws inconsistent with the provisions of this Act are
hereby repealed or modified accordingly.

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SECTION 9. Separability Clause. — If any of the sections or provisions of this Act is held
invalid, all the other provisions not affected thereby shall remain valid.

SECTION 10, Effectivity Clause. ~ This Act shall take effect fifteen (15) days from the date
of its publication in at least two (2) newspapers of general circulation in the Philippines.

Approved,

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