BUSINESS TAX

VALUE ADDED TAX

PERCENTAGE TAX
EXCISE TAX
DOCUMENTARY STAMP TAX
BUSINESS TAX
 Tax imposed on onerous transfers such as
sale, barter, or exchange.
 Can be a Specific Tax or Ad Valorem Tax or
both.
 EXEMPTION: Any business by an INDIVIDUAL
where the aggregate gross sales do not
exceed P 100,000 during the any 12 month
period. It shall be considered principally for
subsistence or livelihood.
VALUE ADDED TAX (VAT) 12%
 Tax on the value added to the purchase price
or cost in the sale or lease of goods, property
or service in the course of trade or business.
 It is an Indirect Tax and the amount of tax can
be shifted to the buyer, lessee, or transferee of
the goods. The party directly liable is the seller
although the burden can be shifted to the
buyer.
 Cannot be imposed at the same time with
Percentage Tax
 Can be imposed at the same time with Excise
Tax.
PERSONS SUBJECT TO VAT:
 Those who are VAT registered persons
 Those who are not VAT registered persons
but exceeded the P 3,000,000 Gross Sales
threshold.
 Importer of goods that are subject to VAT.
 GR: Service rendered by a non-resident
foreign person in the Philippines shall be
considered in course of trading or business
even if it is not regular
OTHER PERCENTAGE TAX
 Tax imposed on certain services
 Imposed on Non-VAT registered persons
 Tax Base:

1. Sale of Goods- Gross Sales

2. Sale of Services- Gross Receipts
EXCISE TAX
 Specific Tax- Fixed amount based on
volume, weight or quantity of goods as
measured by tools, instruments or standards.
(e.g. excise tax on cigars and liquors)
 Ad Valorem Tax- Imposition of tax is based
on the value of property subject to tax. (e.g.
VAT, income tax, donor’s tax and estate tax)
 Imposed on the exercise of Police Power.
DOCUMENTARY STAMP TAX
 A tax levied on documents, instruments, loan
agreements, and papers, evidencing the
acceptance, assignment, sale or transfer of
obligation, rights or property incident thereto.
 The amount may be fix or based on par or face
value of the document or instrument
 Failure to pay DST shall not invalidate the
document or instrument. However, it shall not be
recorded or admitted or used as evidence in any
court until the required stamp is affixed thereto
and cancelled.
 No notary or other officer authorized to administer
oaths shall add his JURAT or acknowledgement to
the document unless the proper Documentary
Stamp is affixed thereto and cancelled.