EN 108 – Business Law & Taxation
EXCISE TAXES
GROUP 1
Leader: Aday, Elizabeth
Bomuel, Karyle
Casas, Lizzie Jaysel
Concio, Jan Marc
Dasmariñas, Gino Xandro
Loseriaga, Ericka
Saracia, Justine Jay
BASIC CONCEPT:
• Excise Tax is a tax on the production, sale or consumption of a commodity in a country.
APPLICABILITY:
• On goods manufactured or produced in the Philippines for domestic sale or consumption or
for any other disposition; and
• On goods imported.
TYPES OF EXCISE TAX:
• Specific Tax – refers to the excise tax imposed which is based on weight or volume
capacity or any other physical unit of measurement
• Ad Valorem Tax – refers to the excise tax which is based on selling price or other specified
value of the goods/articles
MAJOR
CLASSIFICATION OF
EXCISABLE
ARTICLES AND
RELATED CODAL
SECTION
ALCOHOL PRODUCTS
Section 141. Distilled Spirits – On distilled spirits, subject to the provisions of Section 133 of this
Code, an excise tax shall be levied, assessed and collected based on the following schedules:
(a) Effective on January 1, 2013
(1) An ad valorem tax equivalent to fifteen percent (15%) of the net retail price (excluding the
excise tax and the value added tax) per proof; and
(2) In addition to the ad valorem tax herein imposed, a specific tax of Twenty pesos
(PhP20.00) per proof liter.
(b) Effective on January 1, 2015
(1) An ad valorem tax equivalent to twenty percent (20%) of the net retail price
(excluding the excise tax and the value-added tax) per proof; and
(2) In addition to the ad valorem tax herein imposed, a specific tax of Twenty pesos
(PhP20.00) per proof liter.
(c) In addition to the ad valorem tax herein imposed, the specific tax rate of Twenty pesos
(PhP20.00) imposed under this Section shall be increased by four percent (4%) every year
thereafter effective on January 1, 2016, through revenue regulations issued by the Secretary of
Finance.
Section 142. Wines – On wines, there shall be collected per liter of volume capacity effective
on January 1, 2013, the following excise taxes:
(a) Sparkling wines/champagnes regardless of proof, if the net retail price per bottle of
seven hundred fifty milliliter (750 ml.) volume capacity (excluding the excise tax and the
value-added tax) is:
(1) ) Five hundred pesos (PhP500.00) or less – Two hundred fifty pesos (PhP250.00);
and
(2) More than Five hundred pesos (PhP500.00) – Seven hundred pesos (PhP700.00).
(b) Still wines and carbonated wines containing fourteen percent (14%) of alcohol by volume or less, Thirty
pesos (PhP30.00); and
(c) Still wines and carbonated wines containing more than fourteen percent (14%) but not more than
twenty-five percent (25%) of alcohol by volume, Sixty pesos (PhP60.00).
Section 143. Fermented Liquors – There shall be
levied, assessed and collected an excise tax on beer,
lager beer, ale, porter and other fermented liquors
except tuba, basi, tapuy and similar fermented liquors.
NEW TAX RATES based on
Republic Act No. 10351 Remarks
2018
2013 2014 2015 2016 2017 onwards
FERMENTED LIQUORS , per liter of volume capacity
1) If the NRP (excluding excise and VAT) per liter of volume capacity is:
Php15.00 Php17.00 Php19.00 Php21.00 Php23.50
Php 50.60 and below
Effective
1/1/2018,
the specific
tax rate shall
be increased
by 4% every
Php20.00 Php21.00 Php22.00 Php23.00 Php23.50 year
thereafter
More than Php 50.60
Effective
1/1/2014,
the specific
tax rate shall
2) If brewed and sold at microbreweries or small establishments such as pubs and restaurants, regardless of the NRP Php28.00 Php29.12 Php30.28 Php31.50 Php32.76
be increased
by 4% every
year
thereafter
TOBACCO PRODUCTS
Section 144. Tobacco Products – There shall be collected an excise tax of One peso and seventy-
five centavos (PhP1.75) effective on January 1, 2013 on each kilogram of the following products of
tobacco:
a) Tobacco twisted by hand or reduced into a condition to be consumed in any manner other than
the ordinary mode of drying and curing;
(b) Tobacco prepared or partially prepared with or without the use of any machine or instruments
or without being pressed or sweetened except as otherwise provided hereunder; and
(c) Fine-cut shorts and refuse, scraps, clippings, cuttings, stems and sweepings of tobacco except
as otherwise provided hereunder.
NEW TAX RATES based on Republic Act No. 10351
PARTICULARS Remarks 2018 onwards
2013 2014 2015 2016 2017
TOBACCO PRODUCTS, per kilogram
Tobacco Products
(a) Tobacco twisted by hand or reduced
into a condition to be consumed in any
Php1.75 Php1.82 Php1.89 Php1.97 Php2.05
manner other than the ordinary mode of
drying and curing;
Effective 1/1/2014, the specific tax rate shall be
(b) Tobacco prepared or partially prepared increased by 4% every year thereafter
with or without the use of any machine or
Php1.75 Php1.82 Php1.89 Php1.97 Php2.05
instrument or without being pressed or
sweetened; and
(c) Fine-cut shorts and refuse, scraps,
clippings, cuttings, stems, midribs and Php1.75 Php1.82 Php1.89 Php1.97 Php2.05
sweepings of tobacco;
2. Chewing tobacco unsuitable for use in
Php1.50 Php1.56 Php1.62 Php1.68 Php1.75
any other manner
SEC. 145. Cigars and Cigarettes –
(A) Cigars - There shall be levied, assessed and collected on cigars a tax of One peso (P1.00) per
cigar.
NEW TAX RATES based on Republic Act No. 10351
Remarks 2018 onwards
2013 2014 2015 2016 2017
CIGARS, per cigar
Cigars
Effective
(a) Based on the
1/1/2014, the
NRP per cigar
specific tax rate
(excluding the
20% 20% 20% 20% 20% shall be
excise and
increased by 4%
value-added
every year
taxes), and
thereafter
(b) Per cigar Php5.00 Php5.20 Php5.41 Php5.62 Php5.85
(B) Cigarettes Packed by Hand - There shall be levied, assessed and collected
on cigarettes packed by hand a tax of Forty centavos (P0.40) per pack.
(C) Cigarettes Packed by Machine - There shall be levied, assessed and
collected on cigarettes packed by machine a tax at the rates prescribed below:
The tax on cigarettes and cigars in the Philippines is based on the net retail price, which includes
excise tax and value-added tax. If the net retail price is above Ten Pesos (P10.00) per pack, the tax is
twelve pesos (P12.00). If the net retail price is above Six Pesos and fifty centavos (P6.50) but not
exceeding Ten Pesos (P10.00) per pack, the tax is eight pesos (8.00) per pack. If the net retail price is
five pesos but not exceeding Six Pesos and fifty centavos (P6.50) per pack, the tax is five pesos
(P5.00) per pack. If the net retail price is below Five Pesos (P5.00) per pack, the tax is one peso
(P1.00) per pack. Variants of existing brands of cigarettes introduced in the domestic market after the
effectivity of R.A. No. 8240 will be taxed under the highest classification of any variant of that
brand. The excise tax from any brand of cigarettes within the next three years from the effectivity of
R.A. No. 8240 shall not be lower than the tax, which is due from each brand on October 1, 1996.
RA 10963 ( The Train Law ) increases the excise tax rates on cigarettes packed by hand and packed by
machine, as follows:
SEC. 146. Inspection Fee - For inspection made in accordance with this Chapter, there
shall be collected a fee of Fifty centavos (P0.50) for each thousand cigars or fraction
thereof; Ten centavos (P0.10) for each thousand cigarettes of fraction thereof; Two
centavos (P0.02) for each kilogram of leaf tobacco or fraction thereof; and Three centavos
(P0.03) for each kilogram or fraction thereof, of scrap and other manufactured tobacco.
The tobacco inspection fee for leaf tobacco, scrap, cigars, cigarettes, and other tobacco
products must be paid by the wholesaler, manufacturer, producer, owner, or operator of
the redrying plant before removal. Imported leaf tobacco and products must be paid by the
importer before customs' custody.
PETROLEUM PRODUCTS
Section. 148. Manufactured Oils and Other Fuels –
There shall be collected on refined and manufactured
mineral oils and motor fuels.
RA 10963 ( The Train Law ) increases the tax rates on petroleum products in three (3) tranches beginning January 1, 2018
to January 1, 2020, as follows:
MISCELLANEOUS ARTICLES
SEC. 149. Automobiles - There shall be levied, assessed and collected an ad valorem tax on automobiles based
on the manufacturer’s or importer’s selling price, net of excise and value-added tax, in accordance with the
following schedule:
Effective January 1, 2018
Provided, That hybrid vehicles shall be subject to fifty percent (50%) of the applicable excise tax rates on automobiles
under this Section: Provided, further, That purely electric vehicles and pick-ups shall be exempt from excise tax on
automobiles.
Section 150. Non-essential Goods – There shall be levied, assessed and collected a tax
equivalent to twenty-percent (20%) based on the wholesale price or the value of importation used
by the Bureau of Customs in determining tariff and customs duties, net of excise tax and value-
added tax.
Section 150–A. Non-essential Services – There shall be levied, assessed, and collect a tax
equivalent to five percent (5%) based on the gross receipts derived from the performance of
services, net of excise tax and value-added tax, on invasive cosmetic procedures, surgeries, and
body enhancements directed solely towards improving, altering, or enhancing the patient’s
appearance and do not meaning fully promote the proper function of the body or prevent or treat
illness or disease.
Sec. 150–B. Sweetened Beverages
(A) Rate and Base of Tax.
(B) Definition of Terms.
(1) Sweetened beverages (SBs)
(2) Caloric sweetener
(3) High fructose corn syrup
(4) Non-caloric sweetener
(C) Exclusions
(D) Filing of Return and Payment of Excise Tax and Penalty.
(1) Filing of Return and Payment of Excise Tax on Domestic and Imported Sweetened Beverages.
(2) Penalty
(E) Specific Responsibility of the Food and Drug Administration (FDA)
(F) Duty of the Commissioner to Ensure Payment of Taxes
(G) Review of Implementation of the Sweetened Beverage Tax.
EXCISE TAX ON SWEETENED BEVERAGES
UNDER RA 10963 OR THE TRAIN LAW
BEVERAGES COVERED:
BEVERAGES EXCLUDED:
MINERAL PRODUCTS
Section 151. Mineral Products –
There shall be levied, assessed, and collected on minerals,
mineral products, and quarry resources.
RA 10963 ( The Train Law ) increases the excise tax rate on domestic or imported coal and coke in 3 tranches
beginning January 1, 2018 to January 1, 2020, as follows:
REFERENCE:
(n.d.). Excise Tax. REPUBLIC OF THE PHILIPPINES BUREAU OF INTERNAL REVENUE. Retrieved
October 10, 2023, from https://www.bir.gov.ph/index.php/tax-information/excise-tax.html#codalreferences
N/A, N. (2018). TAX CHANGES YOU NEED TO KNOW REPUBLIC ACT. 10963 (TRAIN). National Tax
Research Center. file:///C:/Users/ASUS/Downloads/Tax-Changes-You-Need-to-Know-under-RA-10963.pdf
Singian, R. (2020). New Excise Tax Structure for Alcohol Products (pp. 1-6). USDA Foreign Agricultural Service.
file:///C:/Users/ASUS/Downloads/New-Excise-Tax-Structure-for-Alcohol-Products_Manila_Philippines_02-07-
2020.pdf
CREDITS: This presentation template was created by Slidesgo, and includes icons by Flaticon,
and infographics & images by Freepik
Thank You!
CREDITS: This presentation template was created by Slidesgo, and includes icons by Flaticon,
and infographics & images by Freepik
