Philippine Taxation

Under American
Period
(1898-1935)
1898-1903: Americans followed the Spanish system of taxation.
- The urbana tax, which focuses on the annual rental value of urban real estate, has been
replaced by the land tax, which charges both urban and rural estate.

July 2, 1904: Bureau of Internal Revenue (BIR) was created through the passage of Reorganization
Act No. 1189

August 1, 1904: The BIR was formally organized and made operational.
- The bureau is mandated by law to assess and collect all national internal revenue taxes,
fees, and charges.
1904: The Internal Revenue of 1904
 Licensed and excise tax
 Taxes on banks
 Document stamp tax
 Cedula
 Taxes on insurance company
 Forest Products
 Mining Concessions
 Taxes on business
 Occupational licenses
1907: Changes in cedula and industria tax.
- The new law fixed the cedula rate per adult male, allowing some places to double the fee,
and an industria tax was imposed.

October 3, 1913: Underwood-Simmons Tariff Act

- It’s purpose was to reduce levies on manufactured and semi-manufactured goods and to
eliminate duties on most raw materials.
Significant changes were made to the country’s taxation system.
Here are some key aspects of taxation during the American
Period:
1. Income Tax: Income tax introduced in 1904, was a significant change in the American period,
aiming to generate revenue from individuals and businesses, initially affecting only Americans and
foreign residents.
2. Tariff and Customs Duties: The American administration imposed tariffs and customs duties on
imported goods to protect American industries and promote trade between the Philippines and US,
aiming to regulate trade and generate revenue.
3. Excise Taxes: Excise taxes were imposed on specific goods and services like alcohol, tobacco,
petroleum products, and luxury items to regulate consumption and generate revenue.
4. Property Tax: Property tax was introduced to collect revenue from property owners by
determining the value of properties, including lands, buildings, and improvements.
5. Business Taxes: During the American period, the Philippines implemented various business
taxes such as corporate income, business license, and capital stock tax to generate revenue from
businesses and corporations.
6. Tax Incentives: The American administration introduced tax incentives, including tax holidays,
reduced rates, and exemptions, to stimulate economic growth and attract foreign investments.
7. Local Taxation: During the American period, decentralization of taxation enabled local
governments to effectively manage and generate revenue within their jurisdiction.

Transition to Commonwealth Status (1935)

- In 1935, the Philippines transitioned to Commonwealth status, affecting taxation and
requiring further refinement and adaptation by the Commonwealth government for full
independence.
That’s all and thank you!!!
Members:
• Ysabell Bianca Santiago
• Eufronio Carbonel
• Jenny Salazar Pahayahay
• Joyce Bedua
• Marietoni Dimaya
• Raymundo Raynold
• Mark Angelico Simpao