TRANSACTION SUBJECT TAX BASE TAX RATE EXCEPTION

TO TAX
TAX ON TRANSFER OF REAL PROPERTY OWNERSHIP
Sale , donation, barter, Whichever is higher Not more than fifty Transfer under the
or on any other mode of between: percent (50%) of the one Comprehensive Agrarian
transferring ownership 1. Total consideration percent (1%) Reform Program
or title of real property involved in the acquisition
of the property; or
2. The fair market value in
case the monetary
consideration involved in
the transfer is not
substantial.

Person Liable to Pay: Seller, donor, transferor, executor, or administrator

Time of Payment: within 60 days from the date of the execution of the deed or from the date of the decedent’s death
TAX ON THE BUSINESS OF PRINTING AND PUBLICATION
Business of printing and Gross annual receipts for Not exceeding 50% of 1% School texts or references,
publication of books, the preceding calendar prescribed by the DepEd
cards, poster, leaflets, year. shall be exempt from tax.
handbills, certificates,
receipts, pamphlets, and
others of similar nature
Capital Investment In the case of a newly started business, the tax shall not
exceed one-twentieth (1/20) of one percent (1%)
FRANCHISE TAX
Businesses enjoying a Gross annual receipts for the preceding calendar year Not exceeding fifty
franchise based on the incoming receipt, or realized, within its percent (50%) of one
territorial jurisdiction. percent (1%)
Capital investment. In the case of a newly started business, the tax shall not
exceed (1/20) of 1%
TAX ON SAND, GRAVEL AND OTHER QUARRY SERVICES
Sand, gravel and other Fair market value in the locality per cubic meter of Not more than ten percent
resources extracted from ordinary stones, sand, gravel, earth, and other quarry (10%)
public lands or from the resources.
beds of seas, lakes, rivers,
streams, creeks, and
other public waters
within its territorial
jurisdiction
Who issues permit: issued exclusively by the provincial governor pursuant to the ordinance of the Sangguniang
Panlalawigan
Distribution of Tax Proceeds:
a. Province – 30%
b. Component city or municipality – 30%
c. Barangay where resources were extracted 40%
NOTE: the authority to impose taxes and fees for extraction of sand and gravel belongs to the province, and not to the
municipality where they are found (Municipality of San Fernando La Union vs. Sta. Romana, G.R. No. L-30159, March
31, 1998).
Regalian Doctrine is not applicable. Province may not invoke the doctrine to extend the coverage of its ordinance
to quarry resources extracted from private lands.
Rationale: Tax statutes are construed strictissimi juris against the government (Province of Bulacan v. CA, G.R. No.
126232).
PROFESSIONAL TAX
Exercise or practice of At such amount and Not to exceed P300 Professionals exclusively
profession requiring reasonable classification employed in the
government licensure as the sanggunian government shall be
examination panlalawigan may impose exempt from the payment
of this tax.
AMUSEMENT TAX
Ownership, lease or Gross receipts from Not more than 10% of GR: The holding of operas,
operation of theaters, admission fees. gross receipts from concerts, dramas, recitals,
cinemas, concert halls, In case of theaters or admission fees (as painting and art
circuses, boxing stadia cinemas, the tax shall first amended by R.A. No. 9640, exhibitions, flower shows,
and other places of be deducted and withheld May 21, 2009) musical programs, literary
amusement by their proprietors, and oratorical
lessees, or operators and presentation shall be
paid to the provincial exempt from the payment
treasurer before the gross of amusement tax.
receipts are divided XPN:
between said proprietors, Holding of pop, rock, or
lessees, or operators and similar concerts shall be
the distributors of the subject to amusement tax.
cinematographic films.
NOTE: Amendments to the VAT law have been consistent in exempting persons subject to amusement tax under the
NIRC from the coverage of VAT. Only lessor or distributors of cinematographic films are included in the coverage of
VAT. This reveals the legislative intent not to impose VAT on persons already covered by the amusement tax. This
holds true even in the case of cinema/theater operators taxed under the LGC of 1991 precisely because the VAT law
was intended to replace the percentage tax on certain services (CIR v. SM Prime Holdings, Inc. etc., G.R. No. 183505,
February 26, 2010).
Distribution of Proceeds: Tax shall be shared equally by the province and municipality where such amusement
places are located.
NOTE: Resorts, swimming pools, bath houses, hot springs, and tourist spots do not belong to the same category or
class as theaters, cinemas, concert halls, and boxing stadia. It follows that they cannot be considered as among the
‘other places of amusement’ contemplated by section 140 of LGB and which may properly be subject to amusement
taxes (Pelizloy Realty Corporation v. Province of Benguet, G.R. No. 183137, April 10, 2013).

TAX ON DELIVERY TRUCK/VAN

Use by manufacturers, Every truck, van or vehicle Not exceeding P500 Exempt from tax on
producers, wholesalers, peddlers imposed by
dealers or retailers of municipalities
truck, van or any vehicle
in the delivery or
distribution of distilled
spirits, fermented
liquors, soft drinks,
cigars and cigarettes,
and other products as
may be determined by
the Sangguniang
Panlalawigan, to sales
outlets or consumers,
whether directly or
indirectly.
Municipal taxes
TAX ON VARIOUS TYPES OF
BUSINESSES PERSON/ ENTITIES
SUBJECT TO TAX
TAX ON BUSINESS
Manufacturers, assemblers,
repackers, processors, brewers,
distillers, rectifiers, and
compounders of liquors, distilled
spirits and wines or manufacturers of
any article of commerce of whatever
kind or nature (Sec. 143[a]).
Gross sales or receipts amount to P6,500,000 or more for the preceding
calendar year
Wholesalers, distributors or dealers
in any article of commerce of
whatever kind or nature (Sec. 143[b],
LGC).
Gross sales or receipts amounting to P2,000,000 or more
Exporters and manufacturers,
millers, producers wholesalers,
distributors, dealers or retailers of
the following essential commodities
(Sec. 143[c], LGC).
Retailers (Sec. 143[d], LGC)
TAX BASE TAX RATE EXCEPTION
Based on the taxpayer’s gross sales GRADUATED ANNUAL FIXED TAX
or receipts for the preceding calendar
year.
Ceases to be a fixed tax, instead a
PERCENTAGE TAX of 37.5% of 1% is imposed.
Based on the gross sales or receipts GRADUATED ANNUAL FIXED TAX
for the preceding calendar year
Tax becomes a PERCENTAGE TAX at the rate of 50% of
1%
Gross Sales or Receipts Not exceeding one-half (1/2) of the rates prescribed
under subsections (a), (b) and (d) of this Section
Gross sales or receipts for the ANNUAL PERCENTAGE TAX of
preceding calendar year P400,000 or 2% a. Gross sales or
less receipts in cities
P50,000 or less
b. Gross sales or
receipts in
municipalities
P30,000 or less

NOTE: taxed by
barangays
Sales or receipts exceeding P400,000 ANNUAL PERCENTAGE TAX of 1%
Contractors and other independent Gross receipts for the preceding GRADUATED ANNUAL FIXED TAX
contractors (Sec. 143[e], LGC) calendar year
Gross receipts amounting to P2,000,000 or more PERCENTAGE TAX of
50% of 1%
Banks and other financial institutions Gross receipts of the preceding 50% of 1%
(Sec. 143[f], LGC) calendar year derived from interests,
commission and discounts from
lending activities, income from
financial leasing, dividends, rentals
on property and profit from exchange
or sale of property insurance
premium
Peddlers engaged in the sale of any Per peddler Not exceeding P50
merchandise or article of commerce
(Sec. 143[g], LGC)
On any business, not otherwise Gross Sales or Receipts Graduated schedule imposed by the Sanggunian
specified above which the concerned, but in no case to exceed the rates prescribed
sanggunian concerned may deem in Sec. 143, LGC.
proper to tax: Provided, That on any
business subject to the excise, value-
added or percentage tax under the
National Internal Revenue Code, as
amended, the rate of tax shall not
exceed 2% of gross sales or receipts
of the preceding calendar year (Sec.
143[h], LGC).
MUNICIPAL NON-REVENUE FEES & CHARGES
Municipalities may impose & collect reasonable fees & charges on business & occupation and, except in case of professional tax, (w/c only provinces & cities
may levy) on the practice of any profession or calling commensurate w/ the cost of regulation, inspection & licensing before any person may engage in such
business/occupation/practice of such profession or calling (Sec. 147, LGC).

Situs of Taxes
SITUATION RECOGNITION OF SALE PAYMENT OF TAX
With branch or sales office or All sales made in the locality where the The tax shall be payable to the city or
warehouse branch or office or warehouse is municipality where the same is
located located.
Where there is no branch or sales The municipality where the sale or The tax shall accrue to the city or
office or warehouse transaction is made. municipality where said principal
The sale shall be recorded in the office is located.
principal office along with the sales
made by said principal office
Branch office – A fixed place in a locality which conducts operations of the business as an extension of the principal office.
Principal office – Head or main office of the business appearing in pertinent documents submitted to the SEC and
specifically mentioned in the Articles of Incorporation.
Where there is a factory, project All sales shall be recorded in the
office, plant or plantation in pursuit principal office.
of business
If plantation is at a place other than where the factory is
located
If manufacturer, contractor, etc. has two or more
factories, project offices, plants or plantations located in
different localities.
Of all sales recorded in the principal
office:
1. 30% taxable to the city or
municipality where the principal office
is located.
2. 70% taxable to the city or
municipality where the factory, plant,
etc. is located.
The 70% (above) shall be divided as
follows:
1. 60% to the city or municipality
where the factory is.
2. 40% to the city or municipality
where the plantation is located.
The 70% shall be prorated among the
localities where such factories, project
offices, plants and plantations are
located based on their respective
volumes of production.
All sales shall be recorded in the principal office.
All sales shall be recorded in the principal office.
Sources of Taxes in Barangay
SOURCES OF REVENUE
Barangay Taxes – On stores or
retailers with fixed business
establishments
Service Fees or Charges
Barangay Clearance
TAX BASE TAX RATE FEES AND CHARGES
Gross sales receipts for preceding Not exceeding 1% of such gross sales
calendar year of P50,000 or less (for or receipts.
barangay in the cities); and
P30,000 or less (for barangay and
municipalities
Services rendered in connection with Reasonable Fees or charges
the regulation or the use of
barangay-owned properties; or
Service facilities such as palay, copra,
or tobacco dryers
Reasonable fee as the Sanggunian Barangay may impose

Other Fees and Charges Reasonable fees and charges as the barangay may levy.
a. Commercial breeding of fighting cocks, cockfights and
cockpits
b. Places of recreation which charge admission fees
c. Billboards, signboards, neon signs and outdoor
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