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ACT NO. 2432
ACT NO. 2432 - AN ACT AMENDING ACT
NUMBERED TWENTY-THREE HUNDRED AND THIRTY-NINE, THE INTERNAL REVENUE LAW
OF NINETEEN HUNDRED AND FOURTEEN, BY IMPOSING INCREASED AND ADDITIONAL
TAXES, AND FOR OTHER PURPOSES
Section 1. Subsection (i) of section six of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"(i) The
condition under which alcohol intended for use in the arts and
industries may be withdrawn free of the tax imposed in section
fifty-eight hereof, and dealt in, the character and quantity of the
denaturing material to be used, the manner in which the process of
denaturing shall be affected, the bonds to be given, the books and
records to be kept, the entries to be made therein, the reports to be
made to the Collector of Internal Revenue, and the signs to be
displayed in the business or by the person for whom such denaturing is
done or by whom such alcohol is dealt in."
Sec. 2. Section twenty-one of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended by adding at the
end thereof the following subsection:
"(j) Ad valorem
tax on the output of mines."
Sec. 3. Section twenty-nine of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 29. Secondary certificate in lieu of destroyed cedula certificate. — The
Collector of Internal Revenue, upon presentation to him of satisfactory
proof in the form of an affidavit of the actual destruction or loss of
a cedula certificate of accident, fire, or other casualty and without
any fraud or negligence on the part of the taxpayer, shall issue
gratuitously a secondary certificate showing the number of the original
certificate and its date, together with the other information contained
therein, which secondary certificate may be used in lieu of the
original certificate for all purposes."
Sec. 4. Section thirty-eight of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 38. Liability in general to percentage taxes. — The percentage tax is due
from those engaged in the businesses subject thereto when the amount of
their receipts or the value of their sales, as the case may be, is two
hundred pesos or more a quarter. All such persons are likewise subject
to the fixed privilege tax payable in advance, imposed in section
forty-five, subsection (p) hereof; but if at the end of the quarter it
is found that the amount of a person's receipts or the value of his
sales has reached the point which subjects him to the percentage tax,
he will be allowed a credit equivalent to one quarter's fixed tax on
the percentage tax due from him. In any case the amount of his business
must be reported quarterly as required in the next succeeding section."
Sec. 5. The first two paragraphs of section forty
of Act Numbered Twenty-three hundred and thirty-nine are hereby amended
to read as follows:
"SECTION 40. Percentage tax on merchants' sales. — All merchants not herein
specifically exempted shall pay a tax of one per cent on the gross
value in money of the commodities, goods, wares, and merchandise sold,
bartered, or exchanged by them, such tax to be based on the actual
selling price or value at which the things in question are disposed of,
whether consisting of raw material or of manufactured or partially
manufactured products and whether of domestic or foreign origin.
"Persons engaged in public market places in the sale exclusively of
domestic food products at retail, and retail dealers in tuba and its
similar and retail leaf tobacco dealers are exempt from this tax."
Sec. 6. Section forty-two of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 42. Percentage tax on printers and publishers. — Printers and publishers
shall pay a tax equivalent to one per cent of their gross receipts; but
persons engaged in the publication or printing and publication of any
newspaper, magazine, review, or bulletin appearing at regular intervals
and having fixed prices for subscription and sale shall not be taxed on
receipts from sales of, subscription to, or advertisements in such
publication; but this exemption shall not apply to any publication the
principal purpose of which is the publication of advertisements."
Sec. 7. Section forty-three of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 43. Percentage tax on contractors, warehousemen, and others. — Contractors,
warehousemen, proprietors of dockyards, and persons selling light,
heat, or power, as well as persons engaged in conducting telephone or
telegraph lines, or exchanges, and keepers of hotels and restaurants
shall pay a tax equivalent to one per cent of their gross receipts."
Sec. 8. Section forty-four of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 44. Percentage tax on carriers and keepers of stables and garages. —
Keepers of livery stables and garages, transportation contractors,
persons who transport passengers or freight for hire, and common
carriers by land or water, except owners of boats taxed under the laws
administered by the Bureau of Customs, shall pay a tax equivalent to
one per cent of their gross receipts."
Sec. 9. Subsections (j), (l), (m), (p), (q), and
(u) of section forty-five of Act Numbered Twenty-three hundred and
thirty-nine are hereby amended to read as follows, and the following
new subsection to be known as subsection (bb), is hereby added at the
end of said section forty-five:
"(j) Retail
dealers in fermented liquors, twenty pesos:
"(l) Tobacco dealers, twelve pesos;
"(m) Retail leaf tobacco dealers, twenty pesos;
"(p) Merchants (except retail dealers in tuba and its
similar and in leaf tobacco), common carriers, printers and publishers,
contractors, warehousemen, and others subject to the payment of the
percentage tax on business, eight pesos;
"(q) Proprietors of cockpits, two hundred pesos; and
for each cockfight (soltada), a tax of twenty-five centavos;
"(u) Owners of race tracks, for each day on which
races are run on any track, three hundred pesos;
"(bb) Manufacturers of and wholesale dealers in motor
spirits, mineral oils, and lubricating oils, eight pesos."
Sec. 10. The fourteenth and-fifteenth paragraphs
of section forty-six of Act Numbered Twenty-three hundred and
thirty-nine, defining "Wholesale tobacco dealer" and "Retail tobacco
dealer," are hereby repealed and the first two paragraphs following are
substituted therefor; and said section forty-six is further amended by
adding at the end thereof the third paragraph following:
"'Tobacco dealer' comprehends
every person who for himself or on commission sells or offers for sale
cigars, cigarettes, or manufactured tobacco.
"'Retail leaf tobacco dealer' includes every person who for himself or
on commission sells or offers for sale to persons other than registered
dealers in leaf tobacco and manufacturers of cigars, cigarettes, or
manufactured tobacco, leaf tobacco.
"Planters or producers of leaf tobacco are excepted from this tax with
regard to leaf tobacco of their own production.
"'Manufacturer and wholesale dealer in motor spirits and mineral oils'
includes all persons who sell any of the articles made subject to the
specific tax by section seventy-two (a) of this Act in quantities of
four hundred liters or, more at one time, and the manufacturer or
importer of such articles."
Sec. 11. Subsections (c) and (e) and the last
paragraph of section fifty-three of Act Numbered Twenty-three hundred
and thirty-nine are hereby amended to read as follows:
"(c)
Pharmacists, opticians, and dental surgeons, forty pesos;
"(e) Procuradores judiciales, agentes de negocios,
and insurance agents, forty pesos;
"'Agente de negocios' includes all persons who act as agents of others
in the transaction of business with any public officer, as well as
those who conduct collecting, advertising, employment, or private
detective agencies."
Sec. 12. Paragraph (a) of section fifty-eight of
Act Numbered Twenty-three hundred and thirty-nine is hereby amended to
read as follows:
"(a) If
produced from sap of the nipa, coconut, or buri palm, or from the
juice, sirup, or sugar of the cane, per proof liter, thirty-five
centavos;"
Sec. 13. Section sixty-one of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 61. Exemption in favor of domestic denatured alcohol. — Domestic alcohol of
not less than one hundred and eighty degrees proof (Ninety per cent
absolute alcohol) may, when denatured, be withdrawn from a registered
distillery or bonded warehouse without the payment of the specific tax
prescribed in section fifty-eight hereof for the purpose of being used
for fuel, light, or power, or for use generally in the arts and
industries."
Sec. 14. Section sixty-four of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 64. Specific tax on fermented liquors. — On beer, lager beer, ale, porter,
and other fermented liquors (except tuba, bassi, tapuy, and similar
domestic fermented liquors) there shall be collected, on each liter of
volume capacity, six centavos."
Sec. 15. Section sixty-seven of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 67. Specific tax on products of tobacco. — On manufactured products of
tobacco, except cigars, cigarettes, and tobacco specially prepared for
chewing so as to be unsuitable for consumption in any other manner, but
including all other tobacco twisted by hand or reduced into a condition
to be consumed in any manner other than by the ordinary mode of drying
and curing; and on all tobacco prepared or partially prepared for sale
or consumption, even if prepared without the use of any machine or
instrument and without being pressed or sweetened; and on all fine-cut
shorts and refuse, scraps, clippings, cuttings, and sweepings of
tobacco, there shall be collected, on each kilogram, sixty centavos.
"On tobacco specially prepared for chewing so as to be unsuitable for
use in any other manner, on each kilogram, forty-eight centavos."
Sec. 16. Section sixty-nine of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 69. Specific tax on cigars and cigarettes. — On cigars and cigarettes
(except handmade cigars and cigarettes prepared by the consumer for his
own consumption and so used) there shall be collected the following
taxes:
"(a) Cigars, six pesos per thousand;
"(b) Cigarettes;
"1. Weighing not more than two kilograms per
thousand, on each thousand, one peso and twenty centavos;
"2. Weighing more than two kilograms per thousand, on
each thousand, two pesos."
Sec. 17. Article five of chapter two of Act
Numbered Twenty-three hundred and thirty-nine is hereby amended by
adding at the end thereof two new sections to be known as sections
seventy-two A and seventy-two B, to read as follows:
"SECTION 72A. Specific tax on motor spirits and refined or manufactured mineral oils.
— On motor spirits and refined or manufactured mineral oils, there
shall be collected the following tax:
"(1) Naphtha, gasoline, and all lighter products of
distillation, per liter of volume capacity, four centavos;
"(2) Kerosene or petroleum, per liter of volume
capacity, one and one-half centavos;
"(3) Lubricating oils, per liter of volume capacity,
four centavos;
"(4) Denatured alcohol, per liter of volume capacity,
one and one-half centavos.
"This tax shall apply to articles now manufactured or produced or which
may hereafter be manufactured or produced in the Philippine Islands for
domestic sale or consumption and to like articles imported from the
United States or foreign countries.
"On the date of the taking effect
of this section, all manufacturers and wholesale dealers as
hereinbefore defined shall make a return to the provincial treasurer of
the province in which they are situated, showing the amount of motor
spirits and refined or manufactured mineral oils on hand and shall pay
thereon the tax prescribed in this section before disposing of same, in
the manner prescribed by the Collector of Internal Revenue. No tax
shall be collected on such articles which, before the taking effect of
this Act, shall have been disposed of to consumers or persons other
than manufacturers or wholesale dealers. The Collector of Internal
Revenue may exact a bond conditioned upon the payment of these taxes
before the removal of said articles from the premises of the
manufacturer or wholesale dealer. No tax shall be collected on any of
such articles subsequently received by wholesale dealers, upon which
the tax has been paid by the previous owner or wholesale dealer. When
wholesale dealers shall have paid the tax on all such articles in their
possession, they may be relieved from payment of further privilege tax
as such if they sell only motor spirits and mineral oils on which the
tax has been paid by the previous owner.
"SECTION 72B. Tax on coal. — On all coal and coke
shall be collected, per metric ton, one peso."
Sec. 18. Section one hundred of Act Numbered
Twenty-three hundred and thirty-nine is hereby amended to read as
follows:
"SECTION 100. Privilege tax on signs, signboards, and billboards. —
"(a) Upon outdoor signs, signboards, and billboards
erected, displayed, or maintained in any place exposed to public view
shall be paid, by the person so erecting, displaying, or maintaining
the same, a privilege tax, to be competed upon superficial area, as
follows:
"(1) Upon signs, signboards, and spaces regularly
used for temporary signs on buildings used for business purposes, per
square meter or fraction thereof, per annum, one peso;
"(2) Upon billboards and upon all signs displayed on
premises not occupied by buildings used for business purposes, per
square meter or fraction thereof, per annum, two pesos.
"(b) Signs and signboards having a total area of less
than one square meter shall be taxed as of one meter.
"(c) Signs or signboards announcing exclusively the
name or style, address, and nature of business of a person shall not be
subject to this tax if displayed on the premises in which the business
of such person is carried on.
"(d) When the tax is prepaid in full for the entire
quarter following that in which the sign, signboard, or billboard is
erected or displayed, the tax collected for the current quarter shall
be prorated on the remaining portion of the current quarter.
"(e) Removal of
signs by the Government. — Any sign, signboard, or billboard which
shall be erected, displayed, or maintained without the privilege tax
thereon having been paid as hereinabove provided shall be removed by
the Government at the owner's expense.
"(f) Restrictive provisions. — No sign, signboard, or
billboard shall be erected or displayed on public lands, premises, or
buildings. If after due investigation and having given the owners an
opportunity to be heard the Collector of Internal Revenue shall decide
that any sign, signboard, or billboard displayed or exposed to public
view is offensive to the sight or is otherwise a nuisance, he may order
the removal of such sign, signboard, or billboard, and if same is not
removed within ten days after he has issued such order he may himself
cause its removal, and the sign, signboard, or billboard shall
thereupon be forfeited to the Government, and the expenses incident to
the removal of the same shall become a lawful charge against any person
or property liable for the privilege tax thereon.
"When a sign, signboard, or billboard removed as herein contemplated
shall be found not to conform with the requirements of the regulations
of the Bureau relative to signs, signboards, and billboards, no refund
shall be allowed for any portion of the year for which the taxes may
have been paid; otherwise, the Collector of Internal Revenue may in his
discretion make a refund of so much of the annual tax paid as
corresponds to the remaining portion of the year.
"An appeal to the Secretary of Finance and Justice may be taken from
any order of removal made by the Collector of Internal Revenue in
pursuance of this section, and the decision of said Secretary thereon
shall be final."
Sec. 19. Chapter two of Act Numbered Twenty-three
hundred and thirty-nine is hereby amended by adding at the end thereof
the following article:
"ARTICLE X. — Ad valorem tax on
output of mines.
"SECTION 100A. Rate and basis of tax on mines. —
There shall be levied and collected on the gross output of each mine an
ad valorem tax equal to one and one-half per cent of the actual market
value of such output. This tax shall not be imposed with respect to
valid perfected mining concessions granted prior to April eleventh,
eighteen hundred and ninety-nine, until the year nineteen hundred and
eighteen.
"SECTION 100B. Time and manner of collection. — All
ad valorem taxes on the value of the output of mines shall be assessed
and paid before the removal of any such output from the locality where
it is mined. But the output of mines may be removed from such locality
without the payment of the tax herein imposed, if the owner or
concessionaire of the mine shall first file a bond with the Bureau of
Internal Revenue in the form and amount and with such sureties as the
Collector of Internal Revenue may require, conditioned upon the future
payment of said tax at such time and place as the Collector may direct.
For the purpose of establishing a uniform basis for the assessment of
this tax the Collector of Internal Revenue shall, upon the taking
effect of this article, and from time to time thereafter, make an
assessment of the actual market value of the various products of the
mines in the Philippine Islands subject to the tax herein imposed. Such
"assessment shall be, made from the most reliable data available and
shall be published in the Official Gazette for the information of the
taxpayers."
Sec. 20. Section one hundred and two of Act
Numbered Twenty-three hundred and thirty-nine is hereby amended to read
as follows:
"SECTION 102. Sign to be exhibited by distiller or rectifier. — Every person engaged
in distilling or rectifying spirits, and every wholesale liquor dealer,
shall keep conspicuously on the outside of his place of business a sign
exhibiting, in letters not less than six centimeters high, his name or
firm style, with the words 'Registered distiller,' 'Rectifier of
spirits,' or 'Wholesale liquor dealer,' as the case may be, and his
assessment number. Such a sign shall likewise be kept conspicuously on
the outside of the place of business of every person engaged in the
manufacture or sale at wholesale of motor spirits and mineral oils."
Sec. 21. Section one hundred and nineteen of Act
Numbered Twenty-three hundred and thirty-nine is hereby amended to read
as follows:
"SECTION 119. Requirements incident to process of denaturing alcohol. — Where alcohol
is withdrawn for denaturing for use in the arts and industries, the
process of denaturing shall be effected either on the distillery
premises or in a bonded warehouse designated by the Collector of
Internal Revenue for denaturing purposes only. To such warehouses
alcohol may be transferred under bond and under conditions prescribed
in the Bureau of regulations."
Sec. 22. Section one hundred and sixty-nine of Act
Numbered Twenty-three hundred and thirty-nine is hereby amended to read
as follows:
Sec. 169. Unlawful pursuit of business or
occupation. — Any person who carries on the business of a distiller,
rectifier, wholesale liquor dealer, retail liquor dealer, manufacturer
of tobacco, snuff, cigars, or cigarettes, or dealer in any manufactured
product of tobacco, without having paid the privilege tax therefor as
required by law, shall, in addition to being liable for the payment of
such tax, be punished by a fine in a sum not less than two hundred
pesos nor more than two thousand pesos or by imprisonment for a term
not exceeding six months, or both, in the discretion of the court.
"And in the case of a distiller
or rectifier so offending all distilled spirits and all stills or other
apparatus fit or intended for the distillation or rectification of
spirits, or for the compounding of liquors, owned by such person,
wherever found, and all distilled spirits or wines and personal
property found at the distillery or rectifying establishment or in any
building, room, yard, or inclosure connected therewith and used with or
constituting a part of the premises on which the distilling or
rectifying is carried on, and all the right, title and interest of such
person in the lot or tract of land on which such distillery or
rectifying establishment is situated, and all the right, title and
interest therein of every person who knowingly or with negligence has
suffered or permitted the business of a distiller or rectifier to be
there carried on or has connived at the same, shall be forfeited to the
Government, upon legal proceedings.
"Any person who carries on any other business, or pursues any calling
for which a fixed privilege tax is imposed without paying such tax as
required by law shall in addition to being liable to the payment of
such tax, be punished by a fine in a sum not exceeding one thousand
pesos or by imprisonment for a term not exceeding six months, or both,
in the discretion of the court."
Sec. 23. Chapter five, article two, of Act
Numbered Twenty-three hundred and thirty-nine is hereby amended by
adding after section one hundred and sixty-nine thereof a new section
to be known as section one hundred and sixty-nine A, which will read as
follows:
"SECTION 169A. Failure to make true return of receipts and sales. — Any person who,
being required by law to make a return of the amount of his receipts,
sales, or business, shall fail or neglect to make such return within
the time required, shall be punished by a fine not exceeding two
thousand pesos or by imprisonment for a term not exceeding one year, or
both, in the discretion of the court.
"And any such person who shall make a false or fraudulent return shall
be punished by a fine not exceeding ten thousand pesos or by
imprisonment for a term not exceeding two years, or both, in the
discretion of the court."
Sec. 24. Section one hundred and seventy-one of
Act Numbered Twenty-three hundred and thirty-nine is hereby amended to
read as follows:
"SECTION 171. Unlawful use of denatured alcohol. — Any person who, for the purpose of
manufacturing any beverage, uses denatured alcohol or alcohol withdrawn
from bond for industrial uses, or who knowingly sells any beverage made
in whole or in part from such alcohol, or who uses such alcohol for the
manufacture of liquid medicinal preparations, or knowingly sells such
preparations containing as an ingredient such alcohol, shall on
conviction be fined not more than one thousand pesos or be imprisoned
for not more than one year, or both.
"Any person who shall unlawfully recover or attempt to recover by
redistillation or other process any denatured alcohol or who knowingly
uses, sells, conceals, or otherwise disposes of alcohol so recovered or
redistilled shall be subject to the same penalty as above provided."
Sec. 25. Chapter five, article two, of Act
Numbered Twenty-three hundred and thirty-nine is hereby amended by
inserting the following section:
"SECTION 183A. Unlawful removal of mining products. — Any concessionaire, manager,
owner, or person in charge of any mining products upon which the ad
valorem tax herein imposed is applicable, who unlawfully removes, or
who allows or procures the unlawful removal of any such products from
the place where mined, upon which said ad valorem tax has not been paid
in the time and manner required, and every person who knowingly aids or
abets in the removal of such articles as aforesaid or conceals the same
after their illegal removal, shall for the first offense be punished by
a fine of not more than one thousand pesos or imprisonment for not
longer than six months, or both, and the products so unlawfully removed
shall be forfeited. In case of reincidence the offender under this
section shall be punished by imprisonment for not less than one month
nor more than two years, and if the offense be committed by the
concessionaire, owner, or manager of the mine, or by his connivance,
the mining concession and all mining rights in the property, including
the machinery and apparatus used in and about the mine, and all the
products unlawfully removed shall be forfeited to the Government."
Sec. 26. All increases provided for in this Act of
the several taxes established by Act Numbered Twenty-three hundred and
thirty-nine, shall be in force and effect only from January first,
nineteen hundred and fifteen, to December thirty-first, nineteen
hundred and fifteen.
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