LIFEBLOOD DOCTRINE. O Taxes are the liIeblood oI the nation.

O ithout revenue raised Irom

taxation, the government will not survive, resulting in. detriment to society. ithout taxes, the
government would be paralyzed Ior lack oI motive.
 GENERAL PRINCIPLES OF TAXATION

GENERAL PRINCIPLES OF TAXATION

FUNDAMENTAL PRINCIPLES IN TAXATION
Taxation

 Taxation is the inherent power of the sovereign, exercised through the legislature, to impose
burdens upon subjects and objects within its jurisdiction for the purpose of raising revenues to carry out
the legitimate objects of government.

 It is also defined as the act of levying a tax, i.e. the process or means by which the sovereign,
through its law-making body, raises income to defray the necessary expenses of government. It is a
method of apportioning the cost of government among those who, in some measure, are privileged to
enjoy its benefits and must therefore bear its burdens.

 It is a mode of raising revenue for public purposes, [ Cooley]

Taxes

 Taxes are the enforced proportional contributions from persons and property levied by the law-
making body of the State by virtue of its sovereignty for the support of the government and all public
needs, [Cooley]

 They are not arbitrary exactions but contributions levied by authority of law, and by some rule of
proportion which is intended to ensure uniformity of contribution and a just apportionment of the
burdens of government.

Thus:
a. Taxes are enforced contributions

Taxes are obligations created by law. [Vera v. Fernandez, L-31364, March,30, 1979]. Taxes are
never founded on contract or agreement, and are not dependent for their validity upon the individual
consent of the person taxed.

b. Taxes are proportional in character, since taxes are based on one’s ability to pay.

c. Taxes are levied by authority of law.

The power to impose taxes is a legislative power; it cannot be imposed by the executive department
nor by the courts.

d. Taxes are for the support of the government and all its public needs.

ESSENTIAL ELEMENTS OF A TAX

1. It is an enforced contribution.
2. It is generally payable in money.
3. It is proportionate in character.
4. It is levied on persons, property, or the exercise of a right or privilege (Excise tax).
5. It is levied by the State which has jurisdiction over the subject or object of taxation.
6. It is levied by the law-making body of the State.
7. It is levied for public purpose or purposes.

PURPOSES OF TAXATION

1. Revenue of fiscal: The primary purpose of taxation on the part of the government is to provide funds or
property with which to promote the general welfare and the protection of its citizens and to enable it to
finance its multifarious activities.

2. Non-revenue or regulatory: Taxation may also be employed for purposes of regulation or control. e.g.:

a) Imposition of tariffs on imported goods to protect local industries.

b) The adoption of progressively higher tax rates to reduce inequalities in wealth and income.

c) The increase or decrease of taxes to prevent inflation or ward off depression.

PAL v. Edu, 164 SCRA 320

The legislative intent and purpose behind the law requiring owners of vehicles to pay for their
registration is mainly to raise funds for the construction and maintenance of highways and, to a much
lesser degree, pay for the operating expenses of the administering agency. It is possible for an exaction
to be both a tax and a regulation. License fees are charges, looked to as a source of revenues as well as
means of regulation. The fees may properly be regarded as taxes even though they also serve as an
instrument of regulation. If the purpose is primarily revenue, or if revenue is at least one of the real and
substantial purposes, then the exaction is properly called a tax.

Tio v. Videogram, 151 SCRA 208

PD 1987 which created the Videogram Regulatory Board also imposed a 30% tax on the gross
receipts payable to the local government. SC upheld the validity of the law ruling that the tax imposed is
not only a regulatory but also a revenue measure prompted by the realizations that earnings of
videogram establishments of around P600 million annually have not been subject to tax, thereby
depriving the government of an additional source of revenue. It is a user tax imposed on retailers for
every video they make available for public viewing. The 30% tax also served a regulatory purpose: to
answer the need for regulating the video industry, particularly the rampant film piracy, the flagrant
violation of intellectual property rights, and the proliferation of pornographic video tapes.

Caltex v. Commissioner, 208 SCRA 755

Taxation is no longer a measure merely to raise revenue to support the existence of government.
Taxes may be levied with a regulatory purpose to provide means for the rehabilitation and stabilization of
a threatened industry which is affected with public interest as to be within the police power of the State.
The oil industry is greatly imbued with public interest as it vitally affects the general welfare.

SUMPTUARY PURPOSE OF TAXATION

 More popularly known as the non-revenue or regulatory purpose of taxation. While the primary
purpose of taxation is to raise revenue for the support of the government, taxation is often employed as
a devise for regulation by means of which certain effects or conditions envisioned by the government
may be achieved.

 For example, government may provide tax incentives to protect and promote new and pioneer
industries. The imposition of special duties, like dumping duty, marking duty, retaliatory duty, and
countervailing duty, promote the non-revenue or sumptuary purpose of taxation.
THEORY AND BASIS OF TAXATION

 The power of taxation proceeds upon the theory that the existence of government is a necessity;
that it cannot continue without means to pay its expenses; and that for these means, it has a right to
compel all its citizens property within its limits to contribute.

 The basis of taxation is found in the reciprocal duties of protection and support between the
State and its inhabitants. In return for his contribution, the taxpayer received benefits and protection
from the government. This is the so called “Benefits received principle”.

 Taxation has been defined as the power by which the sovereign raises revenue to defray the
necessary expenses of government. It is a way of apportioning the cost of government among those who
in some measure are privileged to enjoy the benefits and must therefore bear its burden, [ 51 Am. Jur.
34].

 The power of taxation is essential because the government can neither exist nor endure without
taxation. “Taxes are the lifeblood of the government and their prompt and certain availability is an
imperious need”, [Bull v. United States, 295 U.S. 247, 15 APTR 1069, 1073]. The collection of
taxes must be made without any hindrance if the state is to maintain its orderly existence.

 Government projects and infrastructures are made possible through the availability of funds
provided through taxation. The government’s ability to serve and protect the people depends largely
upon taxes. Taxes are what we pay for a civilized society, [Commissioner v. Algue, 158 SCRA 9].

LIFEBLOOD DOCTRINCE

 The lifeblood theory constitutes the theory of taxation, which provides that the existence of
government is a necessity; that government cannot continue without means to pay its expenses; and
that for these means it has a right to compel its citizens and property within its limits to contribute.

 In Commissioner v. Algue, the Supreme Court said that taxes are the lifeblood of the
government and should be collected without necessary hindrance. They are what we pay for a civilized
society. Without taxes, the government would be paralyzed for lack of motive power to activate and
operate it. The government, for its part, is expected to respond in the form of tangible and intangible
benefits intended to improve the lives of the people and enhance their moral and material values.

 By enforcing the tax lien, the BIR availed itself of the most expeditious way to collect the
tax.Taxes are the lifeblood of the government and their prompt and certain availability is an imperious
need, [CIR v. Pineda, 21 SCRA 105].

 The government is not bound by the errors committed by its agents. In the performance of its
governmental functions, the State cannot be estopped by the neglect of its agents and officers. Taxes are
the lifeblood of the nation through which the government agencies continue to operate and with which
the state effects its functions fro the welfare of its constituents. The errors of certain administrative
officers should never be allowed to jeopardize the government’s financial position, [CIR v. CTA, 234
SCRA 348].

 The BIR is authorized to collect estate tax deficiency through the summary remedy of levying
upon the sale of real properties of a decision without the cognition and authority of the court sitting in
 probate over the supposed will of the decedent, because the collection of the estate tax is executive in
character. As such, the estate tax is exempted from the application of the statute on non-claims, and this
is justified by the necessity of government funding, immortalized in the maxim “Taxes are the lifeblood of
the government and should be made in accordance with law, as any arbitrariness will negate the very
reason for government itself, [Marcos II v. CA, 273 SCRA 47].

 Taxes are the lifeblood of the government and so should be collected without unnecessary
hindrance. Philex’s claim that it had no obligation to pay the excise tax liabilities within the prescribed
period since it still has pending claims for VAT input credit/refund with the BIR is untenable, [Philex
Mining Corporation v. CIR, 294 SCRA 687]

Illustrations of Lifeblood theory

1. Collection of taxes cannot be enjoined by injunction.

2. Taxes could not be the subject of compensation or set off.

3. A valid tax may result in the destruction of the taxpayer’s property.

4. Taxation is an unlimited and plenary power.

NECESSITY THEORY

 Taxation as stated in the case of Phil. Guaranty Co., Inc. v. Commissioner [13 SCRA
775],is a power predicated upon necessity. It is a necessary burden to preserve the State’s sovereignty
and a means to give the citizenry an army to resist aggression, a navy to defend its shores from invasion,
a corps of civil servants to serve, public improvements for the enjoyment of the citizenry, and those
which come within the State’s territory and facilities and protection which a government is supposed to
provide.

BENEFITS RECEIVED PRINCIPLE

 This theory bases the power of the State to demand and receive taxes on the reciprocal duties of
support and protection. The citizen supports the State by paying the portion from his property that is
demanded in order that he may, by means thereof, be secured in the enjoyment of the benefits of an
organized society. Thus, the taxpayer cannot question the validity of the tax law on the ground that
payment of such tax will render him impoverished, or lessen his financial or social standing, because the
obligation to pay taxes is involuntary and compulsory, in exchange for the protection and benefits one
receives from the government.

 In return for his contribution, the taxpayer receives the general advantages and protection which
the government affords the taxpayer and his property. One is compensation or consideration for the
other; protection for support and support for protection.

 However, it does not mean that only those who are able to and do pay taxes can enjoy the
privileges and protection given to a citizen by the government.

 In fact, from the contribution received, the government renders no special or commensurate
benefit to any particular property or person. The only benefit to which the taxpayer is entitled is that
derived from the enjoyment of the privilege of living in an organized society established and safeguarded
by the devotion of taxes to public purpose. The government promises nothing to the person taxed
beyond what may be anticipated from an administration of the laws for the general good, [Lorenzo
v. Posadas].

 Taxes are essential to the existence of the government. The obligation to pay taxes rests not
upon the privileges enjoyed by or the protection afforded to the citizen by the government, but upon the
necessity of money for the support of the State. For this reason, no one is allowed to object to or resist
payment of taxes solely because no personal benefit to him can be pointed out as arising from the tax,
[Lorenzo v. Posadas].
DOCTRINE OF SYMBIOTIC RELATIONSHIP

 This doctrine is enunciated in CIR v. Algue, Inc. [158 SCRA 9], which states that “Taxes are
what we pay for civilized society. Without taxes, the government would be paralyzed for lack of the
motive power to activate and operate it. Hence, despite the natural reluctance to surrender part of one’s
hard-earned income to the taxing authorities, every person who is able must contribute his share in the
burden of running the government. The government for its part, is expected to respond in the form of
tangible and intangible benefits intended to improve the lives of the people and enhance their material
and moral values.”

What is the scope of the power to tax?

The power of taxation is the most absolute of all powers of the government [Sison v. Ancheta
130 SCRA 654]. It has the broadest scope of all the powers of government because in the absence of
limitations, it is considered as unlimited, plenary, comprehensive and supreme.
However, the power of taxation should be exercised with caution to minimize injury to the
proprietary rights of the taxpayer. It must be exercised fairly, equally, and uniformly, lest the tax collector
kill “the hen that lays the golden egg” [Roxas v. CTA, 23 SCRA 276].

When is taxation considered as an implement of police power?

In Walter Lutz v. J. Antonio Araneta, 98 Phil 148 , the SC upheld the validity of the tax law
increasing the existing tax on the manufacture of sugar. “The protection and promotion of the sugar
industry is a matter of public concern; the legislature may determine within reasonable bounds what is
necessary for its protection and expedient for its promotion. If objective and methods alike are
constitutionally valid, there is no reason why the state may not levy taxes to raise funds for their
prosecution and attainment. Taxation may be made the implement of the state’s police power.”

In Tio v. Videogram Regulatory Board, 151 SCRA 208, the levy of a 30% tax under
PD1987, was imposed primarily for answering the need for regulating the video industry, particularly the
rampant film piracy, the flagrant violation of intellectual property rights, and the proliferation of
pornographic videotapes, and is therefore valid. While the direct beneficiaries of the said decree is the
movie industry, the citizens are held to be its indirect beneficiaries.

What is the concept of fiscal adequacy?

That the sources of revenues must be adequate to meet government

expenditures, [Chavez v. Ongpin, 186 SCRA 331].
 Revenue Regulations

No. of Issuance Subject Matter Date of Issue

RR No. 15-2018 Amends RR No. 8-2018 particularly on the due date for the April 5, 2018
updating of registration from VAT to Non-VAT
(Published in Manila Bulletin on April 7, 2018)
Digest | Full Text
RR No. 14-2018 Amends the provisions of RR No. 11-2018, particularly April 5, 2018
Sections 2 and 14 relative to withholding of Income Tax
(Published in Manila Bulletin on April 7, 2018)
Digest | Full Text
RR No. 13-2018 Prescribes the Regulations implementing the Value-Added Tax March 15, 2018
(VAT) provisions under RA No. 10963 (TRAIN Law), which further
amends RR No. 16-2005 (Consolidated VAT Regulations of 2005), as
amended
(Published in Manila Bulletin on March 19, 2018)
Digest | Full Text

RR No. 12-2018 Consolidates Revenue Regulations on Estate Tax and Donor's Tax March 15, 2018
incorporating the amendments introduced by RA No. 10963 (TRAIN
Law)
(Published in Manila Bulletin on March 19, 2018)
Digest | Full Text

RR No. 11-2018 Amends certain provisions of RR No. 2-98, as amended, to implement March 15, 2018
further amendments introduced by RA No. 10963 (TRAIN Law)
relative to withholding of Income Tax
(Published in Manila Bulletin on March 19, 2018)
Digest | Full Text | Annex A | Annex B-1 | Annex B-
2 | Annex B-3 | Annex C | Annex D | Annex E | Annex F

RR No. 9-2018 Prescribes the rules and regulations implementing the increase in the February 26, 2018
Stock Transfer Tax pursuant to RA No. 10963 (TRAIN Law)
(Published in Manila Bulletin on February 28, 2018)
Digest | Full Text
RR No. 8-2018 Implements the amended provisions on Income Tax pursuant to RA February 20, 2018
No. 10963 (TRAIN Law)
(Published in Manila Bulletin on February 22, 2018)
Digest | Full Text
RR No. 5-2018 Implements the adjustment of rates on Excise Tax on Automobiles January 15, 2018
pursuant to the provisions of RA No. 10963 (TRAIN Law), amending
for the purpose Revenue Regulations No. 25-2003
(Published in Manila Bulletin on January 18, 2018)
Digest | Full Text
RR No. 4-2018 Provides the rules and regulations implementing the Documentary January 15, 2018
Stamp Tax rate adjustment under RA No. 10963 (TRAIN Law)
(Published in Manila Bulletin on January 18, 2018)
Digest | Full Text
RR No. 3-2018 Provides the revised tax rates on Tobacco Products pursuant to the January 15, 2018
provisions of RA No. 10963 (TRAIN Law), amending for the purpose
Revenue Regulations No. 17-2012
(Published in Manila Bulletin on January 18, 2018)
Digest | Full Text
RR No. 2-2018 Provides the revised tax rates and other implementing guidelines on January 24, 2018
 Petroleum Products pursuant to the provisions of RA No. 10963
(TRAIN Law)
(Published in Manila Bulletin on January 26, 2018)
Digest | Full Text | Annex A
RR No. 1-2018 Provides the revised tax rates on Mineral Products pursuant to the January 15, 2018
provisions of RA No. 10963 (TRAIN Law), amending for the purpose
Revenue Regulations No. 13-94
(Published in Manila Bulletin on January 18, 2018)
Digest | Full Text

Revenue Memorandum Circulars

No. of Issuance Subject Matter Date of Issue

RMC No. 17-2018 Amends RMC No. 89-2017 and certain provisions of RMC No. 54- March 8, 2018
2014 regarding the processing of claims for issuance of tax
refund/Tax Credit Certificate in relation to amendments made in the
NIRC of 1997, as amended by RA No. 10963 (TRAIN Law)
Digest | Full Text | Annex A.1 | Annex A.1.1 | Annexes A.1.2-
A.1.12 | Annex A.2 | Annex B | Annex C | Annex D | Annex
E | Annex F
RMC No. 4-2018 Provides the transition procedures for all eFPS filers in the filing of January 11, 2018
tax return affected by the revised Excise Tax rates on cigars and
cigarettes, petroleum products, automobiles, non-essential services
(invasive cosmetics procedures), sweetened beverages and mineral
products pursuant to RA No. 10963 (TRAIN Law)
Digest | Full Text
RMC No. 3-2018 Provides the transition procedures for all taxpayers affected by the January 9, 2018
revised tax rates on Documentary Stamp Tax pursuant to the
provisions of RA No. 10963 (TRAIN Law)
Digest | Full Text
RMC No. 2-2018 Prescribes the transition procedures for all taxpayers filing tax returns January 8, 2018
affected by the revised tax rates pursuant to the provisions of RA No.
10963 (TRAIN Law)
Digest | Full Text
RMC No. 1-2018 Prescribes the procedures on the use of Withholding Tax Table on January 4, 2018
Compensation Income and advises on the change of Creditable
Withholding Tax Rate on certain income payments to individuals
Digest | Full Text | Withholding Tax Table
RMC No. 105-2017 Prescribes the Revised Withholding Table on Compensation pursuant December 29, 2017
to the amendments to the NIRC of 1997 introduced by RA 10963
(TRAIN Law)
Digest | Full Text | Withholding Tax Table
RMC No. 26-2018 Circularizes the Revised BIR form No. 2551Q (Quarterly Percentage April 25, 2018
Tax Return) January 2018 (ENCS)
Digest | Full Text | Annex A | Guidelines
RMC No. 27-2018 Circularizes the New and Revised BIR Forms affected by Tax April 27, 2018
Reform for Acceleration and Inclusion (TRAIN) Law
Digest | Full Text | 1601-EQ | 1601-EQ/Guidelines | 1601-FQ | 1601-
FQ/Guidelines | 1602-Q | 1603-Q | 1601-C
RMC No. 28-2018 Advises taxpayers to disregard the penalties computed by the April 30, 2018
Electronic Filing and Payment System (eFPS) in BIR Form Nos.
1602 and 1603 of the eFPS
 Digest | Full Text

Revenue Memorandum Orders

No. of Issuance Subject Matter Date of Issue

RMO No. 14-2018 Creates the Alphanumeric Tax Code of selected revenue source under March 9, 2018
RA No. 10963 (TRAIN Law)
Digest | Full Text
RMO No. 9-2018 Creates and modifies the Alphanumeric Tax Code (ATC) of selected February 6, 2018
revenue source under RA No. 10963 (TRAIN Law)
Digest | Full Text
RMO No. 1-2018 Creates the Alphanumeric Tax Code (ATC) for sweetened beverages January 8, 2018
Digest | Full Text

[return to index]

Forms

Excise Tax

Form No. Form Title

BIR Form No. 2200-S Excise Tax Return for Sweetened Beverages
Form | Guidelines
 10 TRAIN Tax Reform Items

1. New Personal Income Tax Rates

Personal income tax rates will be lowered, while salaried employees
earning annual income of P250,000 or below will be exempted from
paying income taxes.

2. Lower Tax Rates for Professionals

With the revised personal income tax table, salaried employees will
surely benefit from the lower tax rate. Self-employed professionals,
meanwhile, can expect to pay lower taxes as well with the reduced tax
rates for professionals, as follows:
ANNUAL SALES OR GROSS RECEIPTS TAX RATE

P250,000 and below 0%

Below P3 million May choose either 8% flat tax on gross receipts or follow personal income tax table

Above P3 million Subject to personal income tax table

3. Tax on 13th Month Pay and Other Bonuses

The threshold for tax exemption on 13th month pay and other
bonuses received by salaried employees has been raised from the
current P82,000 to P90,000. This means 13th month pay and bonuses
paid to employees that amount to P90,000 or below will not be taxed.
4. Tax on Drinks using Sugar and Caloric / Non-Caloric
Sweeteners
Beverages that use sugar and other sweeteners will be taxed effective
January 2018. These include softdrinks and other cola drinks, fruit
juices, and powdered drinks, among others.

The sugar tax is as follows:

 P6.00 per liter of drink that uses caloric and non-caloric sweeteners
 P12.00 per liter of drink that uses high fructose corn syrup (HFCS)
5. Tax exemption of milk, 3-in-1 coffee, medicines for
diabetes, etc.
Exempted from the sugar tax are milk, 3-in-1 coffee, 100% natural fruit
juice or vegetable juice, medically-indicated beverages, and drinks and
beverages that use natural sweeteners such as coco sugar or stevia.
Meanwhile, drugs and medicines prescribed for diabetes, high
cholesterol, or hypertension will also be exempted from the 12% VAT.

6. Taxes on LPG, Diesel, Gasoline, and other fuel products

Liquefied Petroleum Gas or LPG is currently not taxed, but will be

charged excise tax as follows:
 P1.00 tax per liter in 2018
 P2.00 tax per liter in 2019
 P3.00 tax per liter in 2020
Diesel is also currently not taxed, but will have new taxes, as follows:
 P2.50 tax per liter in 2018
 P4.50 tax per liter in 2019
 P6.00 tax per liter in 2020
Gasoline, both regular and unleaded, will have the following excise taxes
raised from the current P4.35 per liter:
 P7.00 tax per liter in 2018
 P9.00 tax per liter in 2019
 P10.00 tax per liter in 2020
Other fuels and oil products will be taxed as follows:

 Aviation gas – P4.00 per liter

 Asphalts – P8.00 per kilo
 Kerosene – P3.00
 Naphtha – P7.00
 Bunker fuel – P2.50
 Lubricating oil – P8.00
 Paraffin wax – P8.00
  Petcoke – P2.50
UPDATE: Pres. Duterte has vetoed the exemption from excise taxes of
petroleum products used as input, feedstock, or as raw material in the
manufacturing of petrochemical products, or in the refining of petroleum
products, or as replacement fuel for natural gas fired combined cycle
power plants.

7. Taxes on Cars and Automobiles

The new excise taxes for cars will follow a four-tier scheme:

Excise Tax on Cars and Automobiles

NET MANUFACTURER'S PRICE TAX RATE ON HYBRID CARS TAX RATE ON NON-HYBRID CARS

P600,000 and below 2% 4%

Above P600,000 to P1 million 5% 10%

Above P1 million up to P4 million 10% 20%

Above P4 million 25% 50%

Pick-up trucks and electric vehicles will be exempted from additional

taxes. Hybrid cars, as seen in the table above, will be charged 1/2 (half)
the taxes imposed on non-hybrid automobiles.

8. Tax on Coal
The approved excise tax on coal is as follows (currently P10.00 tax per
metric ton):
 P50.00 tax per metric ton in 2018
 P100.00 tax per metric ton in 2019
 P150.00 tax per metric ton in 2020


9. Tax on Tobacco Products

Excise taxes on tobacco products will be increased to P32.50 initially
during the first six months of 2018, then will rise to P35.00 from the rest
of 2018 until 2019.
From 2020 to 2021, the tobacco tax will rise to P37.50, followed by a
fixed tax of P40.00 to be imposed from 2022 to 2023. From 2023
onwards, tobacco taxes will rise 4% annually.

10. Donor’s Tax

Donations or gifts with at least P250,000 worth will be charged a donor’s
tax of 6% flat rate. This will be charged regardless of the relationship
between the donor and the done.

11. Estate Tax

The estate tax, or tax levied on the properties or estate of lawful heirs and
beneficiaries inherited from a deceased person, will now be subject to a
flat rate of 6% on the amount in excess of P5 million.
Estates with a net value of P5 million and below will be exempted from
paying the estate tax. Family homes that are valued at P10 million or
less will also be exempted from estate tax. Under existing tax laws, only
family homes worth P1 million are exempted.

12. Tax on Cosmetic Surgery and other Aesthetic Procedures

Starting 2018, there will be a 5% tax on cosmetic surgeries, aesthetic
procedures, and body enhancements.

13. Documentary Stamp Tax

The documentary stamp tax (DST) charged on some legal or business
transactions will double from P1.50 to P3.00 beginning 2018.
 14. Stock Transaction Tax
Stock trading in the Philippines might be affected with the revised taxes
on stock market activity.

The stock transaction tax — a tax charged on stock sellers when a buy or
sell transaction is made — will be increased to 0.6% of the gross trade
amount from the current 0.5% rate.
Stock-related transactions of companies not listed in the Philippine Stock
Exchange (PSE) will be slapped with a higher stock transaction tax of
15%, an increase from the current 5% or 10%.

15. Foreign Currency Interest Income Tax

The tax on interest income on foreign currency deposits is currently
pegged at 7.5%. This will increase to 15% of the interest on foreign
currency deposit unit (FCDU) under the TRAIN tax reform.

List of Vetoed Items by Pres. Duterte

Here are five (5) items in the tax reform bill that was vetoed by Pres.
Duterte when he signed the bill into law.

1. Veto on the 15% special tax rate for employees of Regional Headquarters
(RHQ), Regional Operating Headquarters (ROHQ), Offshore Banking
Units, and Petroleum Service Contractors and Subcontractors. Thes
employees will be taxed using the regular income tax table as shown in Item
No. 1 above.
2. Veto on the exemption of self-employed professionals, with gross sales or
receipts not exceeding P500,000, from the payment of the 3% percentage tax.
3. Veto on the excise tax exemption of petroleum products used as input,
feedstock, or as raw material in the manufacturing of petrochemical products, or
in the refining of petroleum products, or as replacement fuel for natural gas fired
combined cycle power plants (see Item No. 6 above).
4. Veto on the zero rating of sales of goods and services to separate customs
territory and tourism enterprise zones, specifically, the areas under the Tourism
Infrastructure Enterprise Zone Authority (Tieza).
5. Veto on the earmarking of incremental tobacco taxes