RMC No. 105-2023 — Provides clarification and guidance on the affixture of internal revenue stamps on vapor products pursuant to Section 9 of RR No. 18-2021 and Section 4 (H) of RR No. 14-2022 Digest | Full Text | Annexes

BUREAU OF INTERNAL REVENUE REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE BUREAU OF INTERNALREVENUE dnttYyT OCT 10 2023 CO&DOIA G3Q"AM

RECords mgt. division

August..11,.2023

REVENUE MEMORANDUM CIRCULAR NO. |O5- 2O23

SUBJECT: Clarification and Guidance on the Affixture of Internal Revenue Stamps on Vapor Products Pursuant to Section 9 of Revenue Regulations (RR) No. 18-2021 and Section 4 (H) of RR No. 14-2022]

TO All Internal Revenue Officers, Employees, and Others Concerned

revenue stamps on 'vapor products. This Circular is being issued to provide clarification and guidance on Section 9 of RR No. 18 2021 and Section 4 (H) of RR No. 14-2022, particularly in relation to the affixture of internal

I. POLICIES

(a) Affixture of Stamps. All importations and removals from the place of production of vapor below. products shall be affixed with the internal revenue stamps prescribed by the aforementioned regulations and other related revenue issuances, subject to the transitory provisions outlined

Section 147 of the National Internal Revenue Code (NIRC) of 1997, as implemented by RR No. 7-2021, defines Vapor Products as follows:

that transforms into an aerosol without combustion through the employment of a mechanical or electronic heating element, battery or circuit that can be used to heat such solution or gel, and includes, but is not limited to (ii) a cartridge. (ii) a tank, and (iv) the device without a cartridge or tank. It is commonly known as nicotine salt/salt nicotine, and conventional ifreebase' or classic nicotine, and other similar products: Provided, That all vapor products shall be covered by this Act regardless of its nicotine content. " systems (ENDS/ENNDS), which are combinations of (i) a liguid solution or gel. "(f). Vapor products ' shall mean electronic nicotine and non-nicotine delivery

requirements prescribed under existing law, rules and regulations. Provided that, the immediate container of vapor products (e.g., carton boxes or bottles), overlapping the intended opening of the immediate container in such a manner as to effectively seal the container and prevent the removal of the product without breaking the said stamp and before the immediate container is wrapped in cellophane or transparent wrapper, if applicable. Moreover, the internal revenue stamp shall be affixed on the container in a manner without violating the health warning imported products shall be affixed at the upper or top portion 'of the immediate, exposed The internal revenue stamp for locally manufactured products for the domestic market and]

Clarification and Guidance on the Affixture of Internal Revenue Stamps on Vapor Products Purst Regulations (RR) No. 18-2021 and Section 4 (H) of RR No. 14-2022 Revenue Memorandum Circular Page 1 of 3 suant to Section 9 of Revenue

container (in case of boxes or similar type of container) of vapor products shall have no other opening, at the bottom or any other side, except the opening at the upper or top portion of the container so as to avoid the removal of the product without breaking the stamp affixed on the intended opening of the container.

The excise tax rates imposed shall apply to any liquid substance per milliliter (nicotine salt) of content of vapor product and corresponding excise tax due thereon, to wit: vapor product or a fraction thereof, or per 10 milliliters (conventional freebase) or a fraction thereof. One (1) tax stamp shall be affixed on every container or packaging of vapor products. There shall be prescribed seven (7) container/packaging types according to type and volume

Nicotine Salt (2 ml) Nicotine Salt (10 ml) Nicotine Salt (5 ml) Nicotine Salt (l ml) Type and Volume of Product Current Excise P52.00 (x 10) P52.00 (x 1) P52.00 (x 2) P52.00 (x 5) Tax Rate (2023) Tax Due Excise P104.00 P260.00 P 52.00 P520.00 IIEEAANEE EREERRRE 1t w G D30 C207 0T e'Nad PROROLRCOEROLB ISIAC 1

G

Conventional Freebase (60 ml) Conventional Freebase (10 ml) Conventional Freebase (30 ml) P60.00 (x 30) P60.00 (x 10) P60.00 (x 60) P360.00 P180.00 P60.00 BERRRU 1

CENTAVOS (P2.50) per piece of internal revenue stamp for a minimum of 165,000 pieces per order. stamps and prior to its release from the APO designated plant, the printing and personalization cost thereof shall be paid by the local manufacturer or importer of vapor products to. APO Production Unit, Inc. (APO) in the amount of ONE PESO (P1.00) per piece of internal revenue stamp for a minimum of 1,650,000 pieces per order and TWO PESOS AND FIFTY (b) Payment of the Price of the Stamps. After the approval of the order of internal revenue

(Annex "A ") prescribed herein, the range of Unique Identifier Codes (UICs) of internal revenue stamps received and affixed on vapor products. He/she/it shall submit such ORB to the LT The taxpayer shall encode or record, in the Transcript Sheets of Official Register Book (ORB) Performance Monitoring & Programs Division (LTPMPD) or to the concerned Excise Tax Area (EXTA) having jurisdiction of the place of production/warehouse on or before the eighth (8th) day of the month immediately following the month of operation and every 8th day of every month thereafter.

for purposes of this Circular. RR No. 18-2021 provides for the procedures for the ordering, distribution, and monitoring of internal revenue stamps, as well as report generation relative thereto, which are hereby adopted

I. TRANSITORY PROVISIONS

The following transitory provisions shall be strictly observed:

using the format in Annex "B" hereof. The said inventory list shall be submitted to the Chief, (a) Upon the effectivity of this Circular, all manufacturers, importers, and distributors shall submit an inventory list, signed by an authorized representative, of all stocks of vapor products

Clarification and Guidance on the Affixture of Internal Revenue Stamps on Vapor Products Pursuant to Section 9 of Revenue Regulations (RR) No. 18-2021 and Section 4 (H) of RR No. 14-2022 Revenue Memorandum Circular Page 2 of 3

Excise LT Field Operations Division, National Office Building, BIR Road, Quezon City, within fifteen (15) calendar days immediately after the effectivity of this Circular.

fifteen (15) days after the effectivity of this Circular. / (b) All concerned local manufacturers and importers of vapor products shall enroll with the Enhanced. Internal.Revenue Stamps-Integrated-System-(IRSIS) and the orders for the internal revenue stamps prescribed herein shall be submitted for approval by the BIR not later than

compliant with the design configuration/specifications prescribed herein, specifically that they shall have only one opening. (c) Effective June 1. 2024, all containers (e.g., carton boxes) of vapor products must be

and other related revenue issuances. into the Philippines shall be affixed with the internal revenue stamps prescribed by this Circular (d) Effective June 1, 2024, all vapor products manufactured in the Philippines and/or imported

JII. PENALTIES

provisions of RR No. 18-2021 and RR No. 14-2022. Any violation of this Circular shall be subject to the corresponding penalties under the pertinent

V. EFFECTIVITY

publicity as possible. All concerned are hereby enjoined to be guided accordingly and give this Circular as wide a

This Circular takes effect immediately

TGUI, JR. Ssioner of Internal Revenue 015658

D-OHREA, LTS-Excise/maa/rrie BUREAU OF TNTERNAL REVE NUE nntiiy CoaDND OCT'10 2023 g 30Ar}

RECORDS MGT. DIVISION

Clarification and Guidance on the Affixture of Internal Revenue Stamps on Vapor Products Pursuant to Section 9 of Revenue Regulations (RR) No. 18-2021 and Section 4 (H) of RR No. 14-2022 Revenue Memorandum Circular Page 3 of 3