RMO No. 17-2013 — Creates, modifies and drops Alphanumeric Tax Code on Excise Tax pursuant to Republic Act No. 10351, “An Act Restructuring the Excise Tax on Alcohol and Tobacco Products” as Implemented by Revenue Regulations No. 17-2012 Digest | Full Text

SUBJECT REPUBLIC OF THE PHILIPPINES TO DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE Quezon City June 27, 2013 REVENUE MEMORANDUM ORDER NO. __17-2013__________ : Creation, Modification and Dropping of Alphanumeric Tax Code (ATC) on Excise Tax Pursuant to Republic Act No. 10351,"An Act Restructuring the Excise Tax on Alcohol and Tobacco Products" as Implemented by Revenue Regulations No. 17-2012 : All Collection Agents, Revenue District Officers and Other Internal Revenue Officers Concerned I. Objective: To facilitate the proper identification and monitoring of Excise Tax payments pursuant to Republic Act No. 10351, as implemented by Revenue Regulations No. 17-2012 dated December 21, 2012, the following ATCs are hereby created, modified and dropped. II. The following ATCs are hereby created: ATC Description Legal Basis Tax Rate BIR Form No. A. ALCOHOL PRODUCTS (1) Distilled Spirits XA035 (a) Ad Valorem Tax Rate R.A. 10351 as Per NRP per proof 2200-A/0605 XA036 Based on the Net Retail Price implemented by per proof (excluding the RR No. 17-2012 15% 2200-A/0605 excise and value-added 15% taxes), and Sec. 1.a.1 20% Effective January 1, 2013 Sec. 1.a.1 20% Sec. 1.b.1 20% Effective January 1, 2014 Sec. 1.c. 20% Sec. 1.c. Per proof liter Effective January 1, 2015 Sec. 1.c. R.A. 10351 as Effective January 1, 2016 implemented by RR No. 17-2012 Effective January 1, 2017 Sec. 1.a.2. Sec. 1.a.2. 2018 Onwards Sec. 1.b.2. Sec. 1.c. (b) Specific Tax Sec. 1.c. Effective January 1, 2013 P20. 00 P20. 00 Effective January 1, 2014 P20. 00 P20. 80 Effective January 1, 2015 P21. 63 Effective January 1, 2016 * Effective January 1, 2017 * Effective 1/1/2016, the specific tax rate shall be increased by 4% every year thereafter 1

ATC Description Legal Basis Tax Rate BIR Form No. (2) Fermented liquors, where the Net Retail Price (excluding excise and value-added taxes) per liter of volume capacity is: XA055 (a) Fifty Pesos and Sixty R.A. 10351 as Per liter 2200-A/0605 Centavos (P50.60) or less implemented by RR No. 17-2012 Effective January 1, 2013 P15. 00 Sec. 3.a. Effective January 1, 2014 Sec. 3.a. P15.49 * Effective January 1, 2015 Sec. 3.a. Effective January 1, 2016 Sec. 3.a. P17. 00 Effective January 1, 2017 2018 Onwards Sec. 3 P19. 00 Sec. 3 P21. 00 P23. 50 Effective 1/1/2018, the specific tax rate shall be increased by 4% every year thereafter XA056 * Applicable to the fermented R.A. 10351 as Per liter 2200-A/0605 liquor(s) that are affected by implemented by the 'no downward RR No. 17-2012 reclassification' provision of R.A. No. 10351 Sec. 3.b. (b) More than Fifty Pesos and Sec. 3.b. Sixty Centavos (P50.60) Sec. 3.b. Effective January 1, 2013 P20. 00 Sec. 3.b. Effective January 1, 2014 Sec. 3 P20.57 * Effective January 1, 2015 Sec. 3 P21. 00 Effective January 1, 2016 P21.39 * Effective January 1, 2017 2018 Onwards P22. 00 P22.25 * P23. 00 P23.14 * P23. 50 Effective 1/1/2018, the specific tax rate shall be increased by 4% every year thereafter * Applicable to the fermented liquor(s) that are affected by the 'no downward reclassification' provision of R.A. No. 10351 2

ATC Description Legal Basis Tax Rate BIR Form Per liter No. XA057 (c) Fermented liquors brewed and R.A. 10351 as sold at microbreweries or small implemented by 2200-A/0605 establishments such as pubs RR No. 17-2012 and restaurants, regardless of the Net Retail Price Effective January 1, 2013 Sec. 3 P28. 00 Effective January 1, 2014 * Sec. 3 P29. 12 Effective January 1, 2015 Sec. 3 P30. 28 Effective January 1, 2016 Sec. 3 P31. 50 Effective January 1, 2017 Sec. 3 P32. 76 * Effective 1/1/2014, the specific tax rate shall be increased by 4% every year thereafter B. TOBACCO PRODUCTS (1) Cigars XT035 (a) Ad Valorem Tax Rate Based on the Net Retail Price per cigar (excluding the excise R.A. 10351 as Per NRP per cigar 2200-T/0605 and value-added taxes), and implemented by RR No. 17-2012 XT036 Effective January 1, 2013 20% 2200-T/0605 Effective January 1, 2014 Sec. 5.A.1.a. 20% Effective January 1, 2015 Sec. 5.A.1.a. 20% Effective January 1, 2016 Sec. 5.A.1.a. 20% Effective January 1, 2017 Sec. 5.A.1.a. 20% (b) Specific Tax Sec. 5.A.1.a. Per cigar R.A. 10351 as Effective January 1, 2013 implemented by P5. 00 RR No. 17-2012 P5. 20 Effective January 1, 2014 * Sec. 5.A.1.b. P5. 41 P5. 62 Effective January 1, 2015 Sec. 5.A.2. P5. 85 Sec. 5.A.2. Effective January 1, 2016 Sec. 5.A.2. Sec. 5.A.2. Effective January 1, 2017 * Effective 1/1/2014, the specific tax rate shall be increased by 4% every year thereafter 3

ATC Description Legal Basis Tax Rate BIR Form No. (2) Cigarettes packed by machine, where the Net Retail Price (excluding excise and value-added taxes) per pack is: XT140 (a) Eleven Pesos and Fifty R.A. 10351 as Per pack 2200-T/0605 Centavos (11.50) and below implemented by RR No. 17-2012 P12. 00 Effective January 1, 2013 Effective January 1, 2014 Sec. 5.C.1. P17. 00 Effective January 1, 2015 Sec. 5.C.1. Effective January 1, 2016 Sec. 5.C.1. P21. 00 Effective January 1, 2017 Sec. 5.C.1. 2018 Onwards P25. 00 Sec. 5.C. XT150 (b) More than Eleven Pesos and P30. 00 Fifty Centavos (11.50) Sec. 5.C. Effective Effective January 1, 2013 R.A. 10351 as Effective January 1, 2014 implemented by 1/1/2018, the Effective January 1, 2015 RR No. 17-2012 Effective January 1, 2016 specific tax rate Effective January 1, 2017 Sec. 5.C.2. 2018 Onwards Sec. 5.C.2. shall be increased Sec. 5.C.2. Sec. 5.C.2. by 4% every year Sec. 5.C. thereafter Sec. 5.C. Per pack 2200-T/0605 P25. 00 P27. 00 P28. 00 P29. 00 P30. 00 Effective 1/1/2018, the specific tax rate shall be increased by 4% every year thereafter 4

III. The following ATCs will have a modified description: EXISTING (per ATC Handbook) MODIFIED/NEW BIR Form ATC Description Tax Legal ATC Description Tax Rate Legal Basis No. Rate Basis A. ALCOHOL PRODUCTS A. ALCOHOL PRODUCTS (1) Wines (1) Wines Per liter Per liter A. Sparkling A. Sparkling wines/champagnes wines/champagnes, The tax shall be in where the net retail price accordance with the net (excluding the excise and retail price (excluding value-added taxes) per bottle the excise and value- of 750 ml, regardless of added taxes) per bottle, proof is: regardless of proof, as follows: XA061 (1) Five Hundred Pesos P145.60 Sec. XA061 (1) Five Hundred Pesos R.A. 10351 as 2200-A/ (P500.00) or less implemented by 0605 142(a)(1) (P500.00) or less RR No. 17-2012 of RA No. Sec. 2.a.1. Sec. 2. 9334 Sec. 2. Sec. 2. Effective January 1, 2013 P250.00 Sec. 2. P260.00 Effective January 1, P157.25 Effective January 1, 2014 * P270.40 2Ef0f0e7ctive January 1, P169.83 P281.22 2Ef0f0e9ctive January 1, P183.42 Effective January 1, 2015 P292.47 2011 Y Effective January 1, 2016 P700.00 Y P728.00 P436.80 Effective January 1, 2017 P757.12 XA062 (2) More than Five P787.40 Hundred Pesos P436.80 * Effective 1/1/2014, the P818.90 (>P500.00) P471.74 specific tax rate shall be P509.48 increased by 4% every year P30.00 P550.24 thereafter P31.20 P32.45 Sec. XA062 (2) More than Five Hundred P33.75 R.A. 10351 as 2200-A / 142(a)(2) Pesos (>P500.00) P35.10 implemented by 0605 of RA No. RR No. 17-2012 Effective January 1, 2013 9334 Sec. 2.a.2. Sec. 2. Effective January 1, 2014 * Sec. 2. Sec. 2. Effective January 1, 2015 Sec. 2. Effective January 1, 2016 Effective January 1, 2017 * Effective 1/1/2014, the specific tax rate shall be increased by 4% every year thereafter XA070 B. Still wines containing P17.47 Sec.141(a) XA070 B. Still wines and carbonated R.A. 10351 as 2200-A/ fourteen percent (14%) of RA No. wines containing fourteen implemented by 0605 of alcohol by volume or P17.47 percent (14%) of alcohol by RR No. 17-2012 less P18.87 9334 volume or less P20.38 Effective January 1, 2013 Sec. 2.b. Effective January 1, P22.01 Effective January 1, 2014 * Sec. 2. 2Ef0f0e5ctive January 1, Effective January 1, 2015 Sec. 2. 2Ef0f0e7ctive January 1, Effective January 1, 2016 Sec. 2. 2Ef0f0e9ctive January 1, Effective January 1, 2017 Sec. 2. 2011 * Effective 1/1/2014, the specific tax rate shall be increased by 4% every year thereafter 5

EXISTING (per ATC Handbook) MODIFIED/NEW BIR Form ATC Description Tax Legal ATC Description Tax Rate Legal Basis No. XA080 C. Rate Basis XA080 C. R.A. 10351 as 2200-A / implemented by 0605 Still wines containing P34.94 Sec. Still wines and carbonated RR No. 17-2012 more than fourteen 142(c) of wines containing more than 2200-A / percent (14%) of RA No. fourteen percent (14%) of Sec. 2.c. 0605 alcohol by volume but alcohol by volume but not Sec. 2. not more than twenty- 9334 more than twenty-five Sec. 2. five percent (25%) of percent (25%) of alcohol by Sec. 2. alcohol by volume volume Sec. 2. Effective January 1, P34.94 Effective January 1, 2013 P60.00 R.A. 10351 as 2Ef0f0e5ctive January 1, P34.74 P62.40 implemented by Effective January 1, 2014 * P64.90 RR No. 17-2012 2Ef0f0e7ctive January 1, P40.76 P67.50 Effective January 1, 2015 P70.20 2Ef0f0e9ctive January 1, P44.02 2011 Effective January 1, 2016 Taxed as Distilled XA090 D. Fortified wines Taxed as Sec. 142 XA090 D. Effective January 1, 2017 Spirits containing more than twenty-five percent Distilled of RA No. * Effective 1/1/2014, the (25%) of alcohol by specific tax rate shall be volume shall be taxed Spirits 9334 increased by 4% every year as distilled spirits (Per thereafter Proof liter) Fortified wines containing Note: more than twenty-five percent (25%) of alcohol by volume shall be taxed as distilled spirits (Per Proof liter/NRP) The rates of tax imposed under Alcohol Products namely: (1) Distilled Spirits, (2) Wines and (3) Fermented Liquors shall be increased by eight percent (8%) every two years starting on January 1, 2007 until January 1, 2011. B. TOBACCO PRODUCTS B. TOBACCO PRODUCTS (1) Tobacco Products Per (1) Tobacco Products Per kilogram R.A. 10351 as 2200-T/ kilogram implemented by 0605 RR No. 17-2012 XT010 (a) Tobacco twisted by P1.00 Sec. XT010 (a) Tobacco twisted by hand hand or reduced 144(a) of or reduced into a into a condition to condition to be be consumed in RA No. consumed in any manner any manner other 9334 other than the ordinary than the ordinary mode of drying and mode of drying curing and curing Effective January 1, 2013 P1.75 Sec. 4.a. P1.82 Sec. 4. Effective January 1, 2014 * P1.89 Sec. 4. P1.97 Sec. 4. Effective January 1, 2015 P2.05 Sec. 4. Effective January 1, 2016 Effective January 1, 2017 * Effective 1/1/2014, the specific tax rate shall be increased by 4% every year thereafter 6

EXISTING (per ATC Handbook) MODIFIED/NEW BIR Form ATC Description Tax Legal ATC Description Tax Rate Legal Basis No. XT010 Rate Basis XT010 R.A. 10351 as 2200-T/ (b) Tobacco prepared P1.00 Sec. (b) Tobacco prepared or implemented by 0605 or partially 144(b) of partially prepared with or RR No. 17-2012 prepared with or without the use of any without the use of RA No. machine or instrument or any machine or 9334 without being pressed or instrument or sweetened; and without being pressed or sweetened; and Effective January 1, 2013 P1.75 Sec. 4.b. P1.82 Sec. 4. Effective January 1, 2014 * P1.89 Sec. 4. P1.97 Sec. 4. Effective January 1, 2015 P2.05 Sec. 4. XT010 (c) Fine-cut shorts and P0.79 Sec. 144 XT010 Effective January 1, 2016 R.A. 10351 as 2200-T/ refuse, scraps, of RA No. implemented by 0605 clippings, cuttings, Effective January 1, 2017 RR No. 17-2012 stems, midribs and 9334 sweepings of * Effective 1/1/2014, the tobacco specific tax rate shall be increased by 4% every year thereafter (c) Fine-cut shorts and refuse, scraps, clippings, cuttings, stems, midribs and sweepings of tobacco Effective January 1, 2013 P1.75 Sec. 4.c. P1.82 Sec. 4. Effective January 1, 2014 * P1.89 Sec. 4. P1.97 Sec. 4. Effective January 1, 2015 P2.05 Sec. 4. Effective January 1, 2016 P1.50 R.A. 10351 as 2200-T/ P1.56 implemented by 0605 Effective January 1, 2017 P1.62 RR No. 17-2012 P1.68 * Effective 1/1/2014, the P1.75 Sec. 4 specific tax rate shall be Sec. 4 increased by 4% every Sec. 4 year thereafter Sec. 4 Sec. 4 XT020 (2) Tobacco specially P 0.79 Sec. 144 XT020 (2) Chewing tobacco, unsuitable prepared for chewing so as to be unsuitable of RA No. in any other manner for use in any other manner 9334 Note: Effective January 1, 2013 The rates of tax Effective January 1, 2014 * imposed under Tobacco Products Effective January 1, 2015 namely: (1) Tobacco Products and Effective January 1, 2016 (2) Tobacco prepared for chewing shall be Effective January 1, 2017 increased by six percent (6%) every * Effective 1/1/2014, the two years starting on specific tax rate shall be January 1, 2007 until increased by 4% every year January 1, 2011. thereafter 7

EXISTING (per ATC Handbook) MODIFIED/NEW BIR Form ATC Description Tax Legal ATC Description Tax Rate Legal Basis No. Rate Basis XT040 (3) R.A. 10351 as 2200-T/ XT040 (3) Cigarettes Packed by Per pack Sec. Cigarettes Packed by Hand Per pack implemented by 0605 Hand 145(B) of RR No. 17-2012 RA No. 9334 Effective January 1, 2005 P2.00 Effective January 1, 2013 P12.00 Sec. B. Effective January 1, 2007 P2.23 Effective January 1, 2014 Sec. B. Effective January 1, 2009 P2.47 Effective January 1, 2015 P15.00 Sec. B. Effective January 1, 2011 P2.72 Effective January 1, 2016 Sec. B. Effective January 1, 2017 P18.00 Sec. B. 2018 Onwards P21.00 P30.00 Effective 1/1/2018, the specific tax rate shall be increased by 4% every year thereafter IV. The following ATCs are hereby dropped: ATC Description Legal Basis Tax Rate BIR Form No. A. ALCOHOL PRODUCTS Per proof liter (1) Distilled Spirits P11.65 XA010 (a) If produced from the sap of nipa, Sec.141(a) of RA No. 9334 2200-A/0605 XA010 coconut, cassava, camote, or buri palm Sec.141(a) of RA No. 9334 or from the juice, syrup or sugar of the P11.65 2200-A/0605 cane; If produced in a pot still by small distillers (up to 100 liters/day and 50% alcohol by volume) XA031 (b) If produced from raw materials other Sec. 141(b)(1) of RA No. 9334 P 126.00 2200-A/0605 XA032 than those enumerated in the Sec. 141(b)(2) of RA No. 9334 P 252.00 2200-A/0605 XA033 preceding paragraph, the tax shall be Sec. 141(b)(3) of RA No. 9334 P 504.00 2200-A/0605 in accordance with the net retail price (excluding the excise and value-added taxes) per bottle of seven hundred fifty milliliter (750 ml.) volume capacity, as follows: (1) Less than Two Hundred and Fifty Pesos (<P250.00) (2) Two Hundred and Fifty Pesos (P250.00) up to Six Hundred and Seventy Five Pesos (P675.00) (3) More than Six Hundred and Seventy Five Pesos (>P675.00) (2) Fermented Liquors The tax shall be in accordance with the Per liter net retail price (excluding excise and XA051 value-added taxes) per liter of volume Sec. 143(a) of RA No. 9334 P 8.27 2200-A/0605 capacity, as follows: (1) Less than Fourteen Pesos and Fifty Centavos (<P14.50) 8

ATC Description Legal Basis Tax Rate BIR Form P 12.30 No. XA052 (2) Fourteen Pesos and Fifty Sec. 143(b) of RA No. 9334 Centavos (P14.50) up to Twenty- Sec. 143(c) of RA No. 9334 2200-A/0605 two Pesos (P22.00) Sec. 143 of RA No. 9334 XA053 (3) More than Twenty-two Pesos P 16.33 2200-A/0605 (>P22.00) Regardless of the net retail price, fermented liquors brewed and sold at micro-breweries or small establishments such as pubs and restaurants shall be taxed at P16.33 per liter. Note: The rates of tax imposed under Alcohol Products namely: (1) Distilled Spirits, (2) Wines and (3) Fermented Liquors shall be increased by eight percent (8%) every two years starting on January 1, 2007 until January 1, 2011. B. TOBACCO PRODUCTS (1) Cigars The tax shall be in accordance with the net retail price (excluding excise and value-added taxes) per cigar, as follows: XT031 (a) Five Hundred Pesos (P500.00) or Sec. 145(A)(1) of RA No. 9334 Ten Percent (10%) of 2200-T/0605 less the net retail price * XT032 (b) More than Five Hundred Pesos Sec. 145(A)(2) of RA No. 9334 Fifty Pesos (P50.00) 2200-T/0605 (>P500.00) plus Fifteen Percent (15%) of the net retail * The tax rate/base shall in no price in excess of Five case be lower than P 1.12/cigar as provided in the Tax Code of Hundred Pesos 1997. (P500.00) (2) Cigarettes packed by Machine Per pack The tax shall be in accordance with the net retail price (excluding excise and value-added taxes) per pack, as follows: XT130 (a) Below Five Pesos (P5.00) Sec. 145(C)(1) of RA No. 9334 2200-T/0605 Effective January 1, 2005 P 2.00 Effective January 1, 2007 P 2.23 Effective January 1, 2009 P 2.47 Effective January 1, 2011 P 2.72 9

ATC Description Legal Basis Tax Rate BIR Form XT070 Sec. 145(C)(2) of RA No. 9334 No. (b) Five Pesos (P5.00) but does not P 6.35 XT060 exceed Six Pesos and Fifty Sec. 145(C)(3) of RA No. 9334 P 6.74 2200-T/0605 Centavos (P6.50) P 7.14 XT050 Sec. 145(C)(4) of RA No. 9334 P 7.56 2200-T/0605 Effective January 1, 2005 Effective January 1, 2007 P 10.35 2200-T/0605 Effective January 1, 2009 P 10.88 Effective January 1, 2011 P 11.43 (c) More than Six Pesos and Fifty P 12.00 Centavos (>P6.50) but does not P 25.00 exceed Ten Pesos (P10.00) P 26.06 Effective January 1, 2005 P 27.16 Effective January 1, 2007 P 28.30 Effective January 1, 2009 Effective January 1, 2011 (d) More than Ten Pesos (>P10.00) Effective January 1, 2005 Effective January 1, 2007 Effective January 1, 2009 Effective January 1, 2011 V. Repealing Clause: This Revenue Memorandum Order (RMO) revises portions of all other issuances inconsistent herewith. VI. Effectivity: This RMO shall take effect immediately. Original Signed) ((( (Original Signed) KIM S. JACINTO-HENARES Commissioner of Internal Revenue B-3/tbm 10