Section
1. Section 142 of the National
Internal Revenue Code, as amended, is hereby further amended to read as
follows:
"Sec.
142. Cigars and cigarettes. — chanrobles virtuallaw libraryred
"(a) Cigars.
— There shall be levied, assessed and collected on cigars a tax of ten
(10%) of the constructive manufacturer's or importer's wholesale price
or the actual manufacturer's or importer's wholesale price, whichever
is
higher.
chanrobles virtuallaw libraryred
"(b) Cigarettes
packed by hand. — There shall be levied, assessed and collected on
cigarettes
packed by hand a tax of fifteen percent (15%) of the constructive
manufacturer's
wholesale price or the actual manufacturer's wholesale price, whichever
is higher.chanrobles virtual law library
"(c) Cigarettes
packed by machine. — There shall be levied, assessed and collected on
cigarettes
packed by machine a tax at the rates prescribed below based on the
constructive
manufacturer's wholesale price or the actual manufacturer's wholesale
price,
whichever is higher:
"(1) On
locally manufactured cigarettes which are currently classified and
taxed
at fifty-five percent (55%) or the exportation of which is not
authorized
by contract or otherwise, fifty-five percent (55%) provided that the
minimum
tax shall not be less than Five pesos (P5.00) per pack.chanrobles virtual law library chanrobles virtuallaw libraryred"(2) On
other locally manufactured cigarettes, forty-five percent (45%)
provided
that the minimum tax shall not be less than Three pesos (P3.00) per
pack.chanrobles virtuallaw libraryred Duly
registered or existing brands of cigarettes or new brands thereof
packed
by machine shall only be packed in twenties.chanrobles virtual law library chanrobles virtuallaw libraryredWhen
the registered manufacturer's wholesale price or the actual
manufacturer's
wholesale price whichever is higher of existing brands of cigarettes,
including
the amounts intended to cover the taxes, of cigarettes packed in
twenties
does not exceed Four pesos and eighty centavos (P4.80) per pack, the
rate
shall be twenty percent (20%).chanrobles virtual law library
"(d) Imported
cigarettes. — If the cigarettes are of foreign manufacture, regardless
of the contents per pack, there shall be levied, assessed and collected
a tax of fifty-five percent (55%) of the constructive importer's
wholesale
price or the actual importer's wholesale price, whichever is
higher.
"For
purposes of this section, the term "constructive manufacturer's or
importer's
wholesale price" shall mean the price including the amount intended to
cover the tax imposed in paragraphs (a), (b), (c) or (d) hereof and the
amount intended to cover the value-added tax imposed under Title IV of
this Code at which locally manufactured or imported cigars or
cigarettes
are offered for sale to the wholesalers or distributors as fixed by the
manufacturer or importer and registered with the Bureau of Internal
Revenue
plus a mark up of twenty percent (20%) of such price. The
term "actual manufacturer's or importer's wholesale price" shall mean
the
price at which the purchaser actually pays or is obligated to pay to
the
manufacturer or importer in consideration of the sale, barter, or
exchange
of cigars and cigarettes.chanrobles virtual law library chanrobles virtuallaw libraryred"The
twenty percent (20%) mark up and the minimum taxes provided in this
section
shall be automatically increased in 1996 by ten percent (10%).
"Manufacturers
and importers of cigars and cigarettes shall, within thirty (30) days
from
the effectivity of this Act, submit to the Commissioner of Internal
Revenue
a sworn statement of the manufacturer's or importer's wholesale price
of
each particular brand of their products, and periodically thereafter, a
sworn written notification of any change thereof.
"Any
downward reclassification of present categories, for tax purposes, of
existing
brands of cigars or cigarettes duly registered with the Bureau of
Internal
Revenue at the time of the effectivity of this Act or any reduction or
undervaluation of the manufacturer's or importer's registered wholesale
price or any violation of this section which will reduce the tax
imposed
herein, or the payment thereof, shall be prohibited.
"Any
manufacturer or importer who, in violation of this section, knowingly
misdeclares
or misrepresents in his or its sworn statement herein required any
pertinent
data or information or reduces or undervalues or downgrades the
classification
of any existing brand of cigars and cigarettes duly registered with the
Bureau of Internal Revenue at the time of the effectivity of this Act
shall,
upon discovery, be penalized by a summary cancellation or withdrawal of
his or its permit to engage in business as manufacturer or importer of
cigars or cigarettes. chanrobles virtuallaw libraryred
"Any
corporation, association, or partnership liable for any of the acts or
omissions in violation of this section shall be fined treble the amount
of deficiency taxes, surcharges, and interests which may be assessed
pursuant
to this section.
"Any
person liable for any of the acts or omissions prohibited under this
section
shall be criminally liable and penalized under Section 253 of this
Code. Any
person who willfully aids or abets in the commission of any such act or
omission shall be criminally liable in the same manner as the principal.
"If
the offender is not a citizen of the Philippines, he shall be deported
immediately after serving the sentence without further proceedings for
deportation."
Sec.
2. The wholesale price of cigars
and cigarettes at which they are offered for sale to the wholesalers or
distributors and registered with the Bureau of Internal Revenue as of
December
31, 1992 shall be deemed the manufacturer's or importer's registered
wholesale
price until the submission by the manufacturer or importer of the sworn
statement as required under Section 1 of this Act: Provided, That a
variant
of an existing brand of cigars or cigarettes that shall be manufactured
after the effectivity of this Act shall be taxed at the same level as
the
main brand regardless of its declared wholesale price: Provided,
further,
That to prevent any underpayment of taxes, any new brand of cigars or
cigarettes
with comparable quality, blend, cost of production and other relevant
facts
as brands with a registered wholesale price of Three pesos (P3.00) or
more
per pack, and which shall be manufactured after the effectivity of this
Act, shall be taxed at the highest rate regardless of its declared
wholesale
price. For the purpose of this
section, cigars or cigarettes registered with the Bureau of Internal
Revenue
after May 31, 1993 shall be treated as new brands.chanrobles virtual law library
chanrobles virtuallaw libraryred
Sec.
3. Fifty percent (50%) of the
increment in total revenue collected under this Act for a period of one
(1) year from its effectivity shall be allocated and disbursed solely
for
purposes of providing emergency productive employment to workers
displaced
by the present electricity power crisis. For
this purpose, the Secretary of Labor and Employment, in consultation
with
the Secretary of Finance, shall promulgate the necessary rules and
regulations
for the effective implementation of this section.
Provided,
likewise, That twenty-five percent (25%) of the increment in total
revenue collected under this Act in 1995 shall be collected and
segregated
as a trust fund to be disbursed solely for funding the national health
insurance program as may be hereafter mandated by law.
Sec.
4. The incremental revenue collected
under this Act shall be excluded from the revenue bases as provided
under
Republic Act No. 7171.
Sec.
5. The Secretary of Finance shall,
upon the recommendation of the Commissioner of Internal Revenue,
promulgate
the necessary rules and regulations within six (6) months from the
effectivity
of this Act.
Sec.
6. The Bureau of Internal Revenue
shall adopt any or all of the following measures:
(1) Affixture
of internal revenue fuson stamps. — Internal revenue fuson stamps
without
denomination or class, shall be firmly and conspicuously affixed on any
part of the packages containing the cigarettes as the manufacturer may
deem it fit before said packages are packed in cases for removal from
the
factory. The affixture must
be done in such a manner that will prevent said fuson stamps from being
removed and re-used by washing or any other means and from covering any
warning that may be hereafter required by law to be printed on
cigarette
packages.chanrobles virtual law library chanrobles virtuallaw libraryred(2) Control
of cigarette paper. — chanrobles virtuallaw libraryred(a) No
person shall be permitted to import or manufacture cigarette paper
without
first securing the required permit therefor from the Commissioner of
Internal
Revenue;chanrobles virtuallaw libraryred(b) Only
duly registered cigarette manufacturers are authorized to buy from a
permittee
for use in their factories, but before effecting a sale, it shall be
obligatory
upon the seller of the cigarette paper to secure a written authority
from
the Commissioner of Internal Revenue, accompanied by a written
confirmation
of the buyer;
(c) All
cigarette manufacturers shall keep a manufacturer's cigarette paper
registry
book showing the following information:
(1) Debit
Entries: (i) The
date the cigarette paper is received; chanrobles virtuallaw libraryredchanrobles virtuallaw libraryred(ii) The
date of the authority issued by the Commissioner of Internal
Revenue;
(iii)
name and address of the person from whom received; and
(iv) The
number, brand, and color of bobbins or rolls received, showing also the
length in meters of each.
(2) Credit
Entries: (i) The
date of disposal or use; and chanrobles virtuallaw libraryredchanrobles virtuallaw libraryred(ii) The
number, brand, and color of bobbins or rolls disposed of or used,
showing
also the length in meters of each.chanrobles virtual law library (3) Keeping
of subsidiary books. — Local manufacturers of cigars and cigarettes
shall
keep and maintain subsidiary books covering the following:chanroblesvirtualawlibrary
(a) Inventories
of imported leaf tobacco showing its volume and value; chanrobles virtuallaw libraryred(b) Inventories
of local leaf tobacco showing its volume and value;
(c) Cost
of manufacture for each brand of cigarettes; and chanrobles virtuallaw libraryred
(d) Inventories
of cigarettes produced on a per brand basis showing their respective
volumes
and values.
The
amount that may be needed to implement this provision relative to the
monitoring
of production and volume of removals of cigarette paper and the
printing
of fuson stamps shall be included in the General Appropriations
Act.chanrobles virtual law library
chanrobles virtuallaw libraryred
Sec.
7. Separability Clause. — If
any provision of this Act is subsequently declared unconstitutional,
the
validity of the remaining provisions hereof shall remain in full force
and effect.chanrobles virtual law library
Sec.
8. Repealing Clause. — All laws,
decrees, executive orders, rules and regulations, and other issuances
inconsistent
with this Act are hereby repealed or modified accordingly.
Sec.
9. Effectivity Clause. — This
Act shall take effect after fifteen (15) days from its publication in
the
Official Gazette or in at least two (2) national newspapers of general
circulation whichever comes earlier.chanrobles virtuallaw libraryred
Approved:
June
14, 1993
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