ACT NO. 1940 - AN ACT TO AMEND
SECTIONS TWENTY-FIVE, TWENTY-SEVEN, THIRTY-SIX, SEVENTY-FOUR AND
NINETY-ONE OF ACT NUMBERED ELEVEN HUNDRED AND EIGHTY-NINE, ENTITLED
"THE INTERNAL REVENUE LAW OF NINETEEN HUNDRED AND FOUR," BY IMPOSING
INTERNAL-REVENUE TAXES ON WINES AND IMITATIONS OF WINES AND ON CERTAIN
ARTICLES IMPORTED INTO THE PHILIPPINE ISLANDS, BY PERMITTING THE
REMOVAL OF DISTILLED SPIRITS FROM DISTILLERIES OR BONDED WAREHOUSES FOR
INDUSTRIAL PURPOSES UNDER CERTAIN CONDITIONS WITHOUT THE PAYMENT OF
TAX, AND FOR OTHER PURPOSES |
Section 1. Section twenty-five of Act Numbered Eleven hundred
and eighty-nine, entitled "The Internal Revenue Law of Nineteen hundred
and four," is hereby amended to read as follows: "Sec. 25. The following sources of revenue shall be included in the internal
revenue for the Philippine Islands, and the taxes imposed shall be
collected by the Collector of Internal Revenue through the provincial
treasurers of the several provinces or their authorized deputies, or as
otherwise provided by law, and the revenue obtained therefrom shall be
devoted to the support of the several provinces and of the Insular and
municipal governments in the manner in this Act provided: "1. Certain license tax. "2. Tax on distilled spirits. "3. Tax on fermented liquors and wines. "4. Tax on manufactured tobacco and snuff. "5. Tax on cigars and cigarettes. "6. Tax on
matches. "7. Tax on banks and bankers. "8. Stamp taxes on specified objects. "9. Poll or cedula personal tax. "10. Tax on insurance companies. "11. Tax on forestry products. "12. Tax on valid perfected mining concessions granted prior to April eleventh, eighteen hundred and ninety-nine. "13. Tax on business, manufacture, and occupation." Sec. 2. Section twenty-seven of said Act is hereby amended to read as follows: "Sec. 27. All taxes required by this Act to be paid upon the manufacture or sale
of distilled spirits, rectified or manufactured liquor, wines and
imitations of wines, fermented liquors, manufactured tobacco and snuff,
cigars, cigarettes, and matches, and upon the execution of bonds,
debentures, certificates of stock and indebtedness, or other documents,
instruments, or papers, certificates, receipts, contracts, insurance
bonds, tickets, and other written instruments of every kind which are
subject to tax, and upon all acts, pursuits, and trades subject to the
taxes herein imposed, except the poll taxes, shall be paid by the
affixture of internal-revenue stamps to be purchased, attached, and
canceled in the manner hereinafter provided." Sec. 3. Section thirty-six of said Act is hereby amended to read as follows: "Sec. 36. All distilled, rectified, or manufactured spirits, fermented liquors,
wines, imitation wines, matches, cigars, cigarettes, or manufactured or
partially manufactured tobacco imported from the United States or
foreign countries, shall pay, in addition to the import duties imposed
thereon (if any), the internal-revenue taxes imposed by this Act on
similar articles of domestic manufacture. The taxes on imported
articles shall be paid to the Collector of Internal Revenue or his duly
authorized representative by the owner or importer while the articles
are in the custody of the proper custom-house officer, and the articles
shall not pass out of the custody of said custom-house officer until
the taxes shall have been so paid. All provisions of this Act and the
regulations issued thereunder applicable to manufacturers of and
dealers in articles of domestic manufacture subject to internal-revenue
taxes, and all the provisions of this Act and the regulations issued
thereunder concerning the packing of such articles shall apply to
importers of and dealers in imported articles made subject to said
taxes, and the owner or importer of or dealer in such imported articles
shall be liable to all the penal provisions of this Act prescribed for
manufacturers of, and dealers in, similar articles manufactured in the
Philippine Islands. All taxes imposed under this Act on distilled,
rectified, or manufactured spirits fermented liquors, wines, imitation
wines, matches, cigars, cigarettes, or manufactured or partially
manufactured tobacco, manufactured in the Philippine Islands for
domestic sale or consumption, shall be paid at the time of the removal
of such articles from the manufactory or other bonded warehouse. "No tax imposed under this Act on
any of the articles enumerated in this section shall be collected on
any portion of such articles as may be removed for the purpose of their
exportation and which shall be actually so exported aboard some
ocean-going ship and which shall not be relanded in the Philippine
Islands. "The Collector of Internal Revenue shall issue such rules and regulations as may be necessary to carry into effect the provisions of this section, and for such purpose shall require that such marks or labels be placed on the packages containing such goods, that such bonds shall be given by the owners of such articles, and that such bills of lading, certificates, and other evidence shall be furnished by the owners of such articles as may be necessary to establish the fact that the said articles have, after removal from the manufactory or other bonded warehouse, been actually exported, and that no portion thereof has been sold or delivered for domestic consumption within the Philippine Islands. And upon the presentation of satisfactory proof as aforesaid, it shall be the duty of the Collector of Internal Revenue to cancel the bond or bonds furnished by the owners of such articles conditioned on faithful compliance with the provisions of this section." Sec. 4. Section seventy-four of said Act as amended is hereby further amended to read as follows: "Sec. 74. (a) Except as hereinafter provided there shall be levied and collected
on all distilled spirits and manufactured liquors manufactured in the
Philippine Islands for domestic sale or consumption a tax of twenty
centavos on each liter of proof spirits, until January first, nineteen
hundred and ten, and thereafter a tax of twenty-five centavos on each
liter of proof spirits: Provided, That on all distilled spirits and
manufactured liquors produced by the fermentation of grain, there shall
be levied and collected a tax of seventy centavos per proof liter. The
tax imposed by this section shall be paid by the distillery owners or
persons having possession of such spirits before removal from the
distillery or bonded warehouse, and the tax shall be collected on the
whole number of proof liters and shall be increased in proportion for
any greater strength than the strength of proof spirit as defined in
this article, and every fractional part of a liter, amounting to a half
liter or over in a cask or package shall be taxed as a liter, and any
fractional part of a liter less than a half liter in a cask or package
shall be exempted from tax: Provided, That any package of spirits the
total contents of which are less than a liter shall be taxed as one
liter. "(b) Domestic
alcohol of not less than one hundred and eighty degrees proof (ninety
per centum absolute alcohol) may be withdrawn from a registered
distillery or bonded warehouse without the payment of the
internal-revenue tax provided in this section for use in the arts and
industries and for fuel, light, and power, provided said alcohol shall
have been mixed in the presence and under the direction of an
authorized Government officer, with methyl alcohol or other denaturing
material or materials, or admixture of the same, suitable for the use
for which the alcohol is withdrawn, but which destroys its character as
a beverage and renders it unfit for liquid medicinal purposes; such
denaturing to be done upon the application of any registered distiller
on the distillery premises or elsewhere in denatured alcohol bonded
warehouses specially designated by the Collector of Internal Revenue
for denaturing purposes only, and to which alcohol for industrial
purposes may be transferred from the distillery premises under bond and
under conditions prescribed by the Collector of Internal Revenue with
the approval of the Secretary of Finance and Justice: Provided,
However, That notwithstanding anything in this section contained,
domestic alcohol, when suitably denatured, may be withdrawn from bond
without the payment of internal-revenue tax under the conditions herein
prescribed for use in the manufacture of ether and chloroform and other
definite chemical substances and provided it does not appear in the
finished product as alcohol: And Provided, Further, That the license
taxes imposed by section sixty-eight of this Act upon dealers in
distilled spirits shall not apply to dealers in industrial alcohol
manufactured and sold in accordance with the provisions of this
section, and that the taxes imposed by section one hundred and
thirty-nine of this Act shall apply to all dealers in industrial
alcohol so manufactured and sold. "(c) The
character and quantity of the said denaturing material and the
conditions upon which said alcohol may be withdrawn free of taxes shall
be prescribed by the Collector of Internal Revenue who shall, with the
approval of the Secretary of Finance and Justice, issue all such rules
and regulations, in the manner prescribed in section thirty-six of this
Act, as may be necessary to carry into effect the provisions of this
section. "(d) Distillers, manufacturers, dealers, and all other persons furnishing, handling or using alcohol withdrawn from bond under the provisions of this section shall keep such books and records, execute such bonds, render such returns, and display such signs as the Collector of Internal Revenue, with the approval of the Secretary of Finance and Justice, may by regulation require. Such books and records shall be open at all times to the inspection of any internal-revenue officer or agent. "(e) Any person
who withdraws alcohol free of tax under the provisions of this section
and regulations made in accordance therewith, and who removes or
conceals same or is concerned in removing, depositing, or concealing
same for the purpose of preventing the same from being denatured under
governmental supervision, and any person who uses alcohol withdrawn
from bond under the provisions of paragraph (b) of this section for
manufacturing any beverage, or knowingly sells any beverage made in
whole or in part from such alcohol, and any person who uses alcohol
withdrawn from bond under the provisions of paragraph (b) of this
section for the manufacture of liquid medicinal preparations, except as
therein provided, or knowingly sells any liquid medicinal preparations
containing untaxpaid alcohol as an ingredient, which alcohol was not
withdrawn from bond and used in accordance with the provisions of
paragraph (b) of this section, or knowingly violates any of the
provisions of this section, or who shall recover or attempt to recover
by redistillation or by any other process or means any alcohol render
unfit for beverage or liquid medicinal purposes under the provisions of
this section, or who knowingly uses, sells, conceals, or otherwise
disposes of alcohol so recovered or redistilled, shall on conviction
for each offense be fined not less than five hundred pesos nor more
than ten thousand pesos, or be imprisoned for not less than six months
nor more than five years, or both: Provided, That manufacturers
employing processes in which alcohol used free of tax under the
provisions of this section is expressed or evaporated from the articles
manufactured shall be permitted to recover such alcohol, and to have
such alcohol restored to a condition suitable solely for reuse in
manufacturing processes under such regulations as the Collector of
Internal Revenue, with the approval of the Secretary of Finance and
Justice, shall prescribe." Sec. 5. The title of article six of said Act is hereby amended to read as follows: "ARTICLE VI." "FERMENTED LIQUORS AND WINES." Sec. 6. Section ninety-one of said Act is hereby amended to read as follows: "Sec. 91. On
all beer, lager beer, ale, porter, and other fermented liquor by
whatever name called, except tuba, bassi, and tapuy, which may be
brewed or manufactured in the Philippine Islands for domestic sale or
consumption, there shall be levied and collected a tax of four centavos
on each liter, which tax shall be paid by the owner, agent, or
superintendent of the brewery or premises on which such fermented
liquors are manufactured. On all wines or imitation wines manufactured
in the Philippine Islands there shall be levied and collected upon each
gauge liter removed for domestic consumption the following taxes: "(a) On all sparkling wines, one peso. "(b) On all still wines containing fourteen per centum of alcohol or less, eight centavos. "(c) On all still wines containing more than fourteen per centum of alcohol, fifteen centavos." Sec. 7. This Act shall take effect at such time as may be fixed by the Governor-General by Executive Order with the exception of the provisions contained in the subdivisions (b), (c), (d), and (e), of section seventy-four of Act Numbered Eleven hundred and eighty-nine, as amended by section four of this Act, relative to denatured alcohol, which shall take effect on the first of July, nineteen hundred and nine: Provided, However, That if this Act is not in force on the thirty-first of December, nineteen hundred and nine, the Governor-General shall be authorized to provide for the continuance until the thirty-first of December, nineteen hundred and ten, of the tax on distilled spirits and manufactured liquors in the Philippine Islands for domestic sale or consumption, at the rate of twenty centavos on each liter of proof spirits, and the tax on cigarettes made of tobacco or of any raw material employed as a substitute therefor, at the rate of sixty-seven centavos on each thousand of cigarettes whose weight does not exceed two kilograms a thousand. |