8box Solutions Inc.


Contact Number: 09369340340
Email: sales@8box.solutions

REVENUE REGULATIONS NO. 13-2004 issued on December 29, 2004 implements the provisions of Republic Act (RA) No. 9243, otherwise known as “An Act Rationalizing the Provisions on the Documentary Stamp Tax (DST) of the National Internal Revenue Code (NIRC) of 1997, as Amended, and for Other Purposes”. As a result of the said amendments introduced by RA No. 9243, the Sections under Title VII of the NIRC are now accordingly titled, numbered or renumbered and amended. The rate of DST on the original issue of shares of stock was revised from P 1.50 on each P 200.00 to “P 1.00 on each P 200.00,” or fractional part thereof, of the par value, of such shares of stock. For shares of stock without par value, the basis shall be the actual consideration for the shares of stock. However, in a case where shares of stocks without par value are issued as stock dividends, the basis of the DST shall be the actual value represented by each share. The shares are considered issued upon the acquisition of the stockholder of the attributes of ownership over the shares, which acquisition of such attributes of ownership shall be manifested by the acceptance by the Corporation of the stockholder’s subscription to its shares of stock. The entire shares of stock subscribed are considered issued for purposes of the DST, even if not fully paid. The delivery of the certificates of stock to stockholders is not essential for the DST to accrue. The old tax rate of DST applicable on sales, agreements to sell, memoranda of sales, deliveries, or transfer of shares or certificates of stock is now revised from P 1.50 on each P 200.00 to “P 0.75 on each P 200.00,” or fractional part thereof, of the par value of such stock. Likewise, the documents described as “due bills” and “certificates of obligation” have been removed from the coverage of this renumbered and amended Section. All transfer of shares of stocks of a domestic corporation are subject to the DST upon execution of the deed transferring ownership or rights thereto, or upon delivery, assignment or indorsement of such shares in favor of another. No transfer of shares of stock shall be recorded unless DST thereon has been duly paid for in accordance with Section 201 of the NIRC. All debt instruments, which represent borrowing and lending transactions, are now subject to DST of “P 1.00 on each P 200.00,” or fractional part thereof, of the issue price of any such debt instrument. The DST on all debt instruments shall be imposed only on every original issue and the tax shall be based on the issue price thereof. Hence, sale of a debt instrument in the secondary market will not be subject to the DST. On all bills of exchange (between points within the Philippines) or drafts, there shall be collected a DST of P 0.30 on each P 200.00, or fractional part thereof, of the face value of any such bill of exchange or draft. The DST rate of P 0.50 on each P 200.00 for Life Insurance Policies has been retained but the tax base has been revised from the previous base of “amount insured by any such policy” to the new tax base of “amount of premium collected.” The said DST shall be assessed only on life insurance policies that were issued on or after March 20, 2004, the day R.A. 9243 took effect. The DST on policies of annuities has been amended by changing its tax rate and base to be “P 0.50 on each P 200.00” or fractional part thereof, of the premium or installment payment or contract price collected.” The DST on pre-need plans has also been amended to be “P 0.20 on each P 200.00 of the premium or contribution collected.” The said DST shall be assessed only on annuities and pre-need plans issued on or after March 20, 2004. The following instruments, documents and papers shall be exempt from the DST: (a) Policies of insurance or annuities made or granted by a fraternal or beneficiary society, order, association or cooperative company, operated on the lodge system or local cooperation plan and organized and conducted solely by the members thereof for the exclusive benefit of each member and not for profit. (b) Certificates of oaths administered to any government official in his official capacity or of acknowledgment by any government official in the performance of his official duties; written appearance in any courts by any government official, in his official capacity; certificates of the administration of oaths to any person as to the authenticity of any paper required to be filed in court by any person or party thereto, whether the proceedings be civil or criminal; papers and documents filed in courts by or for the national, provincial, city or municipal governments; affidavits of poor persons for the purpose of proving poverty; statements and other compulsory information required of persons or corporations by the rules and regulations of the national, provincial, city or municipal governments exclusively for statistical purposes and which are wholly for the use of the bureau or office in which they are filed, and not at the instance or for the use or benefit of the person filing them; certified copies and other certificates placed upon documents, instruments and papers for the national, provincial, city or municipal governments, made at the instance and for the sole use of some other branch of the national, provincial, city or municipal governments; and certificates of the assessed value of lands, not exceeding P 200.00 in value assessed, furnished by the provincial, city or municipal Treasurer to applicants for registration of title to land. (c) Borrowing and lending of securities executed under the Securities Borrowing and Lending Program of a registered exchange, or in accordance with regulations prescribed by the appropriate regulatory authority: Provided, however, That any borrowing or lending of securities agreement as contemplated hereof shall be duly covered by a master securities borrowing and lending agreement acceptable to the appropriate regulatory authority, and which agreement is duly registered and approved by the Bureau of Internal Revenue. (d) Loan agreements or promissory notes, the aggregate of which does not exceed P 250,000, or any such amount as may be determined by the Secretary of Finance, executed by an individual for his purchase on installment for his personal use or that of his family and not for business or resale, barter or hire of a house, lot, motor vehicle, appliance or furniture: Provided, however, That the amount to be set by the Secretary of Finance shall be in accordance with a relevant price index but not to exceed 10% of the current amount and shall remain in force at least for 3 years. (e) Sale, barter or exchange of shares of stock listed and traded through the local stock exchange for a period of 5 years from the effectivity of this Act. (f) Assignment or transfer of any mortgage, lease or policy of insurance, or the renewal or continuance of any agreement, contract, charter, or any evidence of obligation or indebtedness, if there is no change in the maturity date or remaining period of coverage from that of the original instrument. (g) Fixed income and other securities traded in the secondary market or through an exchange. (h) Derivatives: Provided, That for purposes of this exemption, repurchase agreements and reverse repurchase agreements shall be treated similarly as derivatives. (i) Interbranch or interdepartmental advances within the same legal entity. (j) All forebearances arising from sales or service contracts including credit card and trade receivables: Provided, That the exemption be limited to those executed by the seller or service provider itself. (k) Bank deposit accounts without a fixed term or maturity. (l) All contracts, deeds, documents and transactions related to the conduct of business of the Bangko Sentral ng Pilipinas. (m)Transfer of property pursuant to Section 40(C)(2) of the National Internal Revenue Code of 1997, as amended. (n) Interbank call loans with maturity of not more than seven (7) days to cover deficiency in reserves against deposit liabilities, including those between or among banks and quasi-banks. The DST rates as imposed under the NIRC, as amended by R.A. 9243, shall be applicable on all documents not otherwise expressly exempted by the said law, notwithstanding the fact that they are in electronic form. As provided for by R.A. 8792, otherwise known as the Electronic Commerce Act, electronic documents are the functional equivalent of a written document under existing laws, and the issuance thereof is therefore tantamount to the issuance of a written document, and therefore subject to DST. The Regulations shall apply to all transactions made or to documents/instruments executed or issued as of March 20, 2004, the date when R. A. No. 9243 took effect.