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PRESIDENTIAL DECREE NO. 1357
PRESIDENTIAL DECREE NO. 1357
- AMENDING Section 195 OF THE NATIONAL INTERNAL REVENUE CODE OF 1977 TO
PROVIDE FOR A MORE REALISTIC AND EQUITABLE SALES TAX SYSTEM FOR
AUTOMOBILES
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WHEREAS, it
is recognized that the car manufacturing industry is contributing a
vital role in the economic development of the country;chanroblesvirtualawlibrary
WHEREAS, there is a need to revise the tax system in order to provide
for a more realistic and equitable sales taxation for
automobiles; chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution, do hereby
order and decree the following:cralaw:red
Section 1. The National Internal Revenue Code of 1977
is hereby amended to read as follows:cralaw:red
"Sec. 195. Percentage Tax on Sales of Automobiles. —
There shall be levied, assessed, and collected once only on every
original sale, barter, exchange, or similar transaction for nominal or
valuable consideration intended to transfer ownership of, or title to,
automobiles, a percentage tax to be paid by the manufacturer or
importer, determined in accordance with the following schedules:cralaw:red
'(A) For locally manufactured automobiles — If the
'suggested retail or list price' or actual retail price, whichever is
higher, does not exceed P35,000, the tax shall be 10% of such retail
price; if it exceeds 35,000 but does not exceed P40,000, the tax shall
be P3,500 plus 20% of the excess over P35,000;chanroblesvirtualawlibrary
If it exceeds P40,000 but does not exceed P45,000, the tax shall be
P4,500 plus 30% of the excess over P40,000;chanroblesvirtualawlibrary
"If it exceeds P45,000 but does not exceed P50,000, the tax shall be
P6,000 plus 40% of the excess over P45,000;chanroblesvirtualawlibrary
"If it excess P50,000 but does not exceed P55,000, the tax shall be
P8,000 plus 50% of the excess over P50,000;chanroblesvirtualawlibrary
"If it exceeds P55,000 but does not exceed P60,000, the tax shall be
P10,500 plus 60% of the excess over P55,000;chanroblesvirtualawlibrary
"If it exceeds P60,000, the tax shall be P13,500 plus 70% of the excess
over P60,000.
(B) For imported automobiles — If the landed cost
plus mark-up as established by Section 193(b) of this Code does not
exceed P35,000 the tax shall be 100% of such landed cost plus mark-up;chanroblesvirtualawlibrary
"If it exceeds P35,000 but does not exceed P40,000 the tax shall be
P35,000 plus 12% of the excess over P35,000;chanroblesvirtualawlibrary
"If it exceeds P40,000 but does not exceed P40,000, the tax shall be
P41,250 plus 150% of the excess over P40,000; chanroblesvirtualawlibrary
"If it exceeds P45,000 but does not exceed P50,000, the tax shall be
P48,750 plus 175% of the excess over P50,000;chanroblesvirtualawlibrary
"If it exceeds P50,000, the tax shall be P57,500 plus 200% of the
excess over P50,000.
"Any percentage, specific or mining tax paid under this title, title IV
or title VII, respectively, on domestically manufactured, processed or
produced, or imported raw materials, part, accessory or other article
forming part of the finished product shall be credited against the
sales tax due on the finished product: Provided, however, That in case
the total tax paid on the raw material, part, accessory or other
article exceeds the amount of the sales tax due on the finished
product, the excess shall be credited against the sales tax liabilities
of the manufacturer for the succeeding taxable quarter: And provided,
further, That the amount of the tax on the raw material, part,
accessory, or other article shall be indicated as a separate item in
the sales invoice.
"Whenever the finished product subject to sales tax is manufactured or
produced out of any raw material part, accessory or other article which
is tax-exempt, the otherwise due on the later shall be deemed to have
paid for purposes of the next preceding paragraph.
"Parts and accessories of automobiles imported as completely knocked
down parts by assemblers registered under the progressive car
manufacturing program of the Board of Investments, or their
replacements; and imported and locally manufactured spare parts and
accessories with which automobiles are usually equipped shall be
subject to the tax under Section 199; Provided, That imported and
locally manufactured parts and accessories of automobiles which are
principally for ornamentation or embellishment; and imported standard
automobile parts accessories certified by the Board of Investments as
being locally manufactured and available in sufficient quantity and
comparable in quality and price shall be subject to a tax of 70% of
landed cost, plus mark-up.
"For purposes of this Section, the term "suggested retail or list
price" mean the price at which locally manufactured automobiles are
offered for sale, to the public, as fixed by the assemblers, which
shall in no case be less than 15% over and above the selling price of
the assembler to the dealer; or not less than 30% over and above the
manufacturing cost, in case of direct sales to the public by the
assemblers.
"Automobile assemblers shall submit to the Commissioner of Internal
Revenue a sworn statement of the 'suggested retail or list price' of
the particular brand, make or model of their products before the same
is offered for sale; and periodically thereafter a notification of any
projected change thereof. The assemblers are also required to cause the
publication of their respective 'suggested retail or list prices' or
any change thereof in a newspaper of general publication.
"A sale of an automobile shall, for the purpose of paragraph (A) this
section, be considered to be a sale of the chassis and of the body
together with parts and accessories with which the same are usually
equipped including other parts and accessories, permanently attached
thereto at the time of the original sale. The term 'automobiles' used
herein shall not include motor vehicles classified as trucks and jeeps."
Section 2. The Secretary of Finance shall, upon
recommendation of the Commissioner of Internal Revenue, promulgate the
rules and regulations for the implementation of this Decree.
Section 3. All laws, rules and regulations
inconsistent with or contrary to the provisions of this Decree are
deemed repealed or amended accordingly.
Section 4. This Decree shall take effect on April 1,
1978.
Done in the City of Manila,
this 21st day of March, in the year of Our Lord nineteen hundred and
seventy-eight.
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