Article 49p. 49

NATIONAL INTERNAL REVENUE CODE TAXATION, TARIFF and CUSTOMS LAWS

the revenue district where the taxpayer is registered or

required to register.

(C) Withholding of Value-added Tax. - The Government

or any of its political subdivisions, instrumentalities or

agencies, including government-owned or -controlled

corporations (GOCCs) shall, before making payment on

account of each purchase of goods and services which

are subject to the value-added tax imposed in Sections

106 and 108 of this Code, deduct and withhold a final

value-added tax at the rate of five percent (5%) of the

gross payment thereof: Provided, That beginning January

1, 2021, the VAT withholding system under this Subsection

shall shift from final to a creditable system: Provided,

further, That the payment for lease or use of properties or

property rights to nonresident owners shall be subject to

twelve percent (12%) withholding tax at the time of

payment: Provided, finally, That payments for purchases

of goods and services arising from projects funded by

Official Development Assistance (ODA) as defined under

Republic Act No. 8182, otherwise known as the 'Official

Development Assistance Act of 1996,' as amended, shall

not be subject to the final withholding tax system as

imposed in this Subsection. For purposes of this Section,

the payor or person in control of the payment shall be

considered as the withholding agent. (as amended by RA

No 10963)

SEC. 115. Power of the Commissioner to Suspend the

Business Operations of a Taxpayer. - The Commissioner

or his authorized representative is hereby empowered to

suspend the business operations and temporarily close

the business establishment of any person for any of the

following violations:

(a) In the case of a VAT-registered Person. -

(1) Failure to issue receipts or invoices;

(2) Failure to file a value-added tax return as

required under Section 114; or

(3) Understatement of taxable sales or receipts

by thirty percent (30%) or more of his correct

taxable sales or receipts for the taxable quarter.

(b)

Failure of any Person to Register as Required

under Section 236.

The temporary closure of the establishment shall be

for the duration of not less than five (5) days and

shall be lifted only upon compliance with whatever

requirements prescribed by the Commissioner in

the closure order.

TITLE V OTHER PERCENTAGE TAXES

(As Last Amended by RA Nos. 8761, 9010, 9238, 9337 &

10001, 10963) [80]

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 Five hundred

thousand pesos (P500,000) shall be exempt from the

three percent (3%) gross receipts tax herein imposed (as

amended by RA No 10963)

SEC. 117. Percentage Tax on Domestic Carriers and

Keepers of Garages. - Cars for rent or hire driven by the

lessee, transportation contractors, including persons who

transport passengers for hire, and other domestic carriers

by land, [81] for the transport of passengers [except owners

of bancas] and owners of animal-drawn two wheeled

vehicle), and keepers of garages shall pay a tax equivalent

to three percent (3%) of their quarterly gross receipts.

The gross receipts 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 percentage tax provided in this Section,

the following shall be considered the minimum quarterly

gross receipts in each particular case:

Jeepney for hire -

1. Manila and other Cities

2. Provincial

Public utility bus -

Not exceeding 30 passengers

Exceeding 30 but not exceeding 50

passengers

Exceeding 50 passengers

Taxis -

1. Manila and other Cities

2. Provincial

Car for hire (with chauffer)

Car for hire (without chauffer)

P 2,400

1,200

P 3,600

6,000

7,200

P 3,600

2,400

P 3,000

1,800

SEC. 118 Percentage Tax on International Carriers. - [82]

(A)

International air carriers doing; business in the

Philippines on their gross receipts derived from transport

of cargo from the Philippines to another country shall pay

a tax of three percent (3%) of their quarterly gross

receipts.

(B)

International shipping carriers doing business in the

Philippines on their gross receipts derived from transport

of cargo from the Philippines to another country shall pay

a tax equivalent to three percent (3%) of their quarterly

gross receipts.

SEC. 119. Tax on Franchises. - Any provision of general or

special law to the contrary notwithstanding, there shall

be

levied,

assessed

and

collected

in

respect

to

all

franchises

on

radio

and/or

television

broadcasting

companies whose annual gross receipts of the preceding

year do not exceed Ten million pesos (P10,000.00), subject

to Section 236 of this Code, a tax of three percent (3%) and

on gas and water utilities, a tax of two percent (2%) on the

gross receipts derived from the business covered by the

law granting the franchise: Provided, however, That radio

and television broadcasting companies referred to in this

Section

shall have an option to be registered as a

value-added taxpayer and pay the tax due thereon:

Provided, further, That once the option is exercised, said

option shall not be irrevocable. [83]

The grantee shall file the return with, and pay the tax due

thereon to the Commissioner or his duly authorized

representative,

in

accordance

with the provisions of

Section 128 of this Code, and the return shall be subject to

audit by the Bureau of Internal Revenue, any provision of

any existing law to the contrary notwithstanding.

SEC.

120.

Tax

on

Overseas

Dispatch,

Message

or

Conversation Originating from the Philippines. -

(A) Persons Liable. - There shall be collected upon every

overseas dispatch, message or conversation transmitted

from the Philippines by telephone, telegraph, telewriter

exchange, wireless and other communication equipment

service, a tax of ten percent (10%) on the amount paid for

such services. The tax imposed in this Section shall be

payable by the person paying for the services rendered

and shall be paid to the person rendering the services

who is required to collect and pay the tax within twenty

(20) days after the end of each quarter.

(B) Exemptions. - The tax imposed by this Section shall

not apply to:

(1)

Government.

-

Amounts paid for messages

transmitted by the Government of the Republic of

the Philippines or any of its political subdivisions or

instrumentalities;

(2)

Diplomatic

Services.

-

Amounts

paid

for

messages transmitted by any embassy and consular

offices of a foreign government;

(3) International Organizations. - Amounts paid for

messages

transmitted

by

a public international

© Compiled by RGL

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