joankristelevangelista

LOCAL TAXES

Local Taxes
Taxes that are due in addition to

state and federal taxes. These can be in the form of property, sales, water, sewer, school, and occasionally, income taxes.

Local Taxes
Funds generated from this cover

some community services. For example, they can be used for public school-related expenses. Also called municipal taxes.

Other Local Taxes

Other Local Taxes

Percentage tax (primarily for non-VAT registered entities)

Excise tax Documentary stamp tax Estate and donors (gift) tax

Excise Tax
Excise taxes are imposed on

selected commodities such as alcoholic beverages, tobacco products, jewelry and petroleum products.

In addition, the government levies a variety of other taxes, including:

mining and

petroleum taxes, residence taxes, a head tax on immigrants above a certain age and staying beyond a certain period,

document stamp

taxes, donor (gift) taxes, estate taxes, and capital gains taxes.

Documentary Stamp Tax

is a tax on documents,

instruments, loan agreements and papers evidencing the acceptance, assignment, sale or transfer of an obligation, right or property incident.

Documentary Stamp Tax

It is charged on stock certificates,

proofs of indebtedness, proofs of ownership, etc, and normally amount to .75% to 1% of the face value of the certificate.

Estate and donors (gift) tax

Donors Tax is a tax on a donation

or gift, and imposed on the gratuitous transfer of property between two or more persons who are living at the time of the transfer.

Estate and donors (gift) tax

It shall apply whether the transfer is in trust or otherwise, whether the gift is direct or indirect and whether the property is real or personal, tangible or intangible.

Corporate Taxpayers

Corporate Taxpayers
1. Domestic corporations are taxed

at 30% of annual taxable income from worldwide sources with option for 15% tax on gross income subject to certain conditions.

Corporate Taxpayers
2.

A foreign corporation, whether engaged or not in trade or business in the Philippines, is taxable on Philippine-sourced income at the same rates as domestic corporations.

Corporate Taxpayers
3. Profits remitted by a branch of a foreign corporation to its home office are taxed at the rate of 15%. Dividends declared by a domestic corporation to its foreign parent are generally taxed at 30%.

Corporate Taxpayers
However, if the home country of the recipient corporation allows an additional credit of 17% as tax deemed paid in the Philippines, the tax is reduced to 15%. Dividends remitted to countries that do not impose a tax on offshore dividends qualify for this rate.

Corporate Taxpayers
Under the Philippine tax treaties with Netherlands, Japan, Germany, Korea and Austria, a preferential tax of 10% on branch profit remittances is granted.

Corporate Taxpayers
4.

All corporations, whether domestic or foreign, are subject to capital gains tax on the sale of shares of stock, in the same manner as individual taxpayers.

Corporate Taxpayers
5. Any excess of the minimum corporate income tax over the normal income tax as computed shall be carried forward and credited against the normal income tax for the three immediately succeeding taxable years.

Corporate Taxpayers
6. In general, an employer (individual

or corporation) shall pay a final tax of 30% on the grossed-up monetary value of fringe benefit furnished or granted to the employee (except rank and file) unless the fringe benefit is required by nature of, or necessary to the trade, business or profession of the employer.

Local tax on Certain Businesses

Local tax on certain businesses

1. Manufacturers, wholesalers, exporters
and contractors are subject to graduated taxes on certain amounts of sales/gross receipts and percentage taxes at maximum rates ranging from .375% to .75% on the amounts not subject to graduated taxes, depending on the place where business is conducted.

Local tax on certain businesses

2. Banks and other financial

institutions- percentage tax at maximum rates ranging from .50% to .75% depending on the locality of the business.

Local tax on certain businesses

3. Others such as: a. Real estate tax b. Stamp tax on certain documents,

instruments and related transactions such as issuance of shares of stock, evidence of indebtedness, transfer of real property, lease contracts insurance policies, etc.. c. Community tax d. Overseas communications tax

Thank You