Business Taxes:
* Taxes
imposed upon onerous transfers such as sale, barter, exchange or importation.
* Business
taxes are in addition to income and other taxes paid unless specifically
exempted.
* If the Transaction
is subject to vat, then it is exempt from percentage tax and vice-versa. However, it may still be subject to excise
tax.
1.
Value-added taxes.
VAT is a
tax on the value added by every seller to
the purchase price or cost in the sale or lease of goods, property or
services in the ordinary course of
trade or business as well as on importation
of goods into the Philippines, whether for personal or business
use. It is a business tax. Without a business pursued in the Philippines
(except importation) by the taxpayer, the tax cannot be applied. “In the
course of trade or business” means the regular conduct or pursuit of a
commercial or an economic activity, including transactions incidental thereto,
by any person regardless of whether or not the person engaged therein is a
non-stock, non-profit private organization or government entity. Generally, services rendered in the
Philippines by a non-resident foreign person shall be considered as being
rendered in the course of trade or business even
if the performance is not regular.
2.
Percentage taxes
* It is a tax imposed
on sale, barter, exchange or importation of goods, or sale of services based
upon gross sales, value in money of receipts derived by the manufacturer,
producer, importer or seller measured by certain percentage of the gross
selling price or receipts.
3.
Excise taxes
* It is a tax imposed
on goods manufactured or produced in the
Philippines for domestic sales or consumption or for any other disposition,
and goods imported. Specifically, excise taxes are imposed on:
Manufacturers and Importers, of any of the following categories of goods or article:
a.
Distilled
spirits such as liquors
b.
Wines
c.
Fermented
liquors (i.e., beer)
d.
Cigars
e.
Cigarettes
f.
Automobiles
g.
Manufactured
fuel oil (i.e., gasoline bunker fuel oil)
h.
Mineral
products (i.e., gold, silver); and
i.
Non-essential
goods (i.e., jewelry, perfumes)
* Classifications:
a.
Specific Excise Tax - Based on weight or volume capacity or any
other physical unit of measurement.
b.
Ad-Valorem Excise
Tax
– Based on selling price or other specified value of the goods.
* Purposes of Imposing Excise Tax
a.
To
curtail consumption of certain commodities which are considered as harmful to
the individual or to the community.
b.
To
protect domestic industries from competition posed by similar imported products.
c.
To
distribute the tax burden in proportion to benefit derived from a particular
government service.
