REVENUE REGULATIONS NO. 13-2002 issued on September 13, 2002 amends further RR No. 9-90 which implements the tax subsidy granted to the Armed Forces of the Philippines Commissary and Exchange Service (AFPCES). The tax subsidy granted shall apply to transactions involving goods or products subject to the following: A) VAT – 1) all goods purchased from VAT-registered manufacturers, producers or suppliers; and 2) net VAT payable of AFPCES arising from sales of goods; B) Excise Tax – 1) alcohol beverages/distilled spirits – a) compounded liquors, b) wines, and c) fermented liquor/beer; and 2) petroleum products. The AFPCES shall be the only one unit of the Armed Forces of the Philippines, which is authorized to purchase articles or commodities from local manufacturers, producers, or suppliers for sale to persons entitled to commissary privileges. The corresponding taxes and duties on the goods purchased or delivered shall be paid through an approved subsidy chargeable against Section 13 of the 2002 General Appropriations Act. No purchase orders for articles or commodities originating from the AFPCES shall be honored nor filled by any manufacturer, producer or supplier unless the same is approved by the authorized official of the AFPCES indicated therein. The AFPCES shall submit to the Commissioner of Internal Revenue, through the Revenue District Office having jurisdiction over the AFPCES’ principal office, a quarterly report of sales of articles/products to its members and purchases. All sales made to AFPCES by the manufacturers, producers or suppliers shall be entered in a registry book, duly registered with the BIR, not later than the day immediately following the date of the transaction. Said book shall be opened for inspection at any time during office hours by any duly authorized internal revenue officer. AFPCES shall file an application with the Department of Budget and Management (DBM) for availment of entitlement to subsidy for the payment of Excise Tax and/or VAT on purchases and subsequent sale of goods. Upon approval of the application, the DBM shall issue a Special Allotment Release Order in favor of the Bureau of Treasury to cover payment of said taxes to the BIR.