Article 64p. 64

NATIONAL INTERNAL REVENUE CODE TAXATION, TARIFF and CUSTOMS LAWS

similar transaction, such tax to be paid by the buyer

or purchaser before removal from the place of

production.

(as amended by RA No 10963)

The phrase ' first taxable sale, barter, exchange or

similar

transaction '

means

the

transfer

of

indigenous petroleum in its original state to a first

taxable

transferee. The fair international market

price shall be determined in consultation with an

appropriate government agency;

For the purpose of this Subsection, ' indigenous

petroleum ' shall include locally-extracted mineral

oil,

hydrocarbon

gas,

bitumen,

crude

asphalt,

mineral

gas

and

all

other

similar

or

naturally

associated substances with the exception of coal,

peat, bituminous shale and/or stratified mineral

deposits.

(B) For purposes of this Section, the term -

(1) ' Gross output ' shall be interpreted as the actual

market value of minerals or mineral products or of

bullion from each mine or mineral land operated as

a

separate

entity,

without

any

deduction from

mining,

milling,

refining (including all expenses

incurred to prepare the said minerals or mineral

products

in

a

marketable

state),

as

well

as

transporting,

handling,

marketing

or

any

other

expenses: Provided, That if the minerals or mineral

products are sold or consigned abroad by the lessee

or owner of the mine under C.I.F. terms, the actual

cost

of

ocean

freight

and

insurance

shall

be

deducted: provided, however, That in the case of

mineral

concentrate,

not

traded

in

commodity

exchanges in the Philippines or abroad, such as

copper concentrate, the actual market value shall be

the world price quotations of the refined mineral

products

content thereof prevailing in the said

commodity

exchanges,

after

deducting

the

smelting, refining and other charges incurred in the

process of converting the mineral concentrates into

refined

metal

traded

in

those

commodity

exchanges.

(2)

' Minerals ' shall mean all naturally occurring

inorganic substances (found in nature) whether in

solid, liquid, gaseous or any intermediate state.

(3) ' Mineral products ' shall mean things produced

and

prepared

in a marketable state by simple

treatment processes such as washing or drying, but

without

undergoing

any

chemical

change

or

process

or

manufacturing

by

the

lessee,

concessionaire or owner of mineral lands.

(4) ' Quarry resources ' shall mean any common

stone or other common mineral substances as the

Director of the Bureau of Mines and Geo-Sciences

may declare to be quarry resources such as, but not

restricted to, marl, marble, granite, volcanic cinders,

basalt, tuff and rock phosphate: Provided, That they

contain no metal or other valuable minerals in

economically workable quantities.

CHAPTER VIII ADMINISTRATIVE PROVISIONS

REGULATING BUSINESS OF PERSONS DEALING IN

ARTICLES SUBJECT TO EXCISE TAX

SEC. 152. Extent of Supervision Over Establishments

Producing Taxable Output. - The Bureau of Internal

Revenue has authority to supervise establishments where

articles subject to excise tax are made or kept. The

Secretary of Finance shall prescribe rules and regulations

as to the mode in which the process of production shall

be conducted insofar as may be necessary to secure a

sanitary output and to safeguard the revenue.

SEC.

153.

Records

to

be

Kept

by

Manufacturers;

Assessment Based Thereon. - Manufacturers of articles

subject to excise tax shall keep such records as required

by

rules

and

regulations

recommended

by

the

Commissioner and approved by the Secretary of Finance,

and such records, whether of raw materials received into

the factory or of articles produced therein, shall be

deemed public and official documents for all purposes.

The records of raw materials kept by such manufacturers

may be used as evidence by which to determine the

amount of excise taxes due from them, and whenever the

amounts

of

raw

material

received

into

any

factory

exceeds

the

amount

of

manufactured

or

partially

manufactured products on hand and lawfully removed

from the factory, plus waste removed or destroyed, and a

reasonable

allowance

for

unavoidable

loss

in

manufacture, the Commissioner may assess and collect

the tax due on the products which should have been

produced from the excess.

The excise tax due on the products as determined and

assessed in accordance with this Section shall be payable

upon demand or within the period specified therein.

SEC.

154.

Premises

Subject

to

Approval

by

Commissioner. - No person shall engage in business as a

manufacturer of or dealer in articles subject to excise tax

unless the premises upon which the business is to

conducted

shall

have

been

approved

by

the

Commissioner.

SEC. 155. Manufacturers and/or Importers to Provide

Themselves with Counting or Metering Devices to

Determine Volume of Production and Importation. —

Manufacturers

of

cigarettes,

alcoholic

products,

oil

products, and other articles subject to excise tax that can

be similarly measured shall provide themselves with such

necessary

number of suitable counting or metering

devices

to

determine

as

accurately

as

possible the

volume, quantity or number of the articles produced by

them under rules and regulations promulgated by the

Secretary

of

Finance,

upon

recommendation of the

Commissioner: Provided, That the Department of Finance

shall maintain a registry of all petroleum manufacturers

and/or importers and the articles being manufactured

and/or imported by them: Provided, further, That the

Department of Finance shall mandate the creation of a

real-time

inventory

of

petroleum

articles

being

manufactured, imported or found in storage depots of

such

petroleum

manufacturers

and/or

importers:

Provided, finally, That importers of finished petroleum

products

shall

also

provide

themselves

with

Bureau-accredited metering devices to determine as

accurately as possible the volume of petroleum products

imported by them.

This

requirement

shall

be

complied

with

before

commencement of operations.

(as amended by RA No 10963)

SEC. 156. Labels and Form of Packages. - All articles of

domestic manufacture subject to excise tax and all leaf

tobacco

shall

be

put

up

and

prepared

by

the

manufacturer or producer, when removed for sale or

consumption, in such packages only and bearing such

marks or brand as shall be prescribed in the rules and

regulations promulgated by the Secretary of Finance; and

goods of similar character imported into the Philippines

shall likewise be packed and marked in such a manner as

may be required.

SEC. 157. Removal of Articles After the Payment of Tax.

- When the tax has been paid on articles or products

subject to excise tax, the same shall not thereafter be

stored or permitted to remain in the distillery, distillery

warehouse, bonded warehouse, or other factory or place

where produced. However, upon prior permit from the

Commissioner, oil refineries and/or companies may store

or deposit tax-paid petroleum products and commingle

the same with its own manufactured products not yet

subjected to excise tax. Imported petroleum products

may be allowed to be withdrawn from customs custody

without the prepayment of excise tax, which products

may

be

commingled

with

the

tax-paid

or

bonded

products of the importer himself after securing a prior

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