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Implementing Guidelines (RA No. 9243) - Change in the rate of DST on all Debt Instruments |
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DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE BANK BULLETIN NO. 2004 - 02 TO: ALL BANKS AND NON-BANK FINANCIAL INTERMEDIARIES FROM: The Commissioner of Internal Revenue SUBJECT: Implementation of Republic Act No. 9243 - Change in the rate of DST on all Debt Instruments Date: March 5, 2004 _____________________________________________________ In relation to Republic Act No. 9243, which was published today in two newspapers of general circulation, the Malaya and Today, all banks and non-bank financial intermediaries are hereby advised as to the following: 1. The provision of the Tax Code imposing stamp tax on debentures and certificates of indebtedness has been deleted. These instruments are now taxable as debt instruments under Section 179 at a lower rate of P1.00 on each P200 or fraction of the issue price thereof (instead of the old rate of P1.50 on each P200); 2. Other debt instruments previously taxed at P0.30 on each P200 are now taxed at P1.00 on each P200 or fraction of the issue price thereof under the same Section 179; 3. The term debt instrument, taxable under Section 179, refers to instruments representing borrowing and lending transactions including but not limited to debentures, certificates of indebtedness, due bills, bonds, loan agreements, including those signed abroad wherein the object of contract is located or used in the Philippines, instruments and securities issued by the government or any of its instrumentalities, deposit substitute debt instruments, certificates or other evidences of deposits that are either drawing interest significantly higher than the regular savings deposit taking into consideration the size of the deposit and the risks involved or drawing interest and having specific maturity date, orders for payment of any sum of money otherwise than at sight or on demand, promissory notes, whether negotiable or non-negotiable, except bank notes issued for circulation; 4. Since the publication of the law was completed today, perforce, it becomes effective beginning March 20, 2004 or 15 days following the completion of publication. Accordingly, the new rate of documentary stamp tax prescribed under R.A. 9243 must be collected on all debt instruments made, signed, issued, accepted or transferred beginning on the date of effectivity thereof; 5. All banks and non-bank financial intermediaries must make the necessary adjustments on their systems to ensure the collection of the correct amount of tax. Please be guided accordingly. (Originally Signed) GUILLERMO L. PARAYNO, JR. Commissioner of Internal Revenue /era DRAFT: Provisions of Republic Act No. 9243 |
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