(NAR) VOL. IV NO. 1 / JANUARY - APRIL 1993
"x x x please be informed that the 5% premium tax payable by every person, company or corporation (except purely cooperative companies or associations) doing insurance business of any sort in the Philippines, is based on the total premium collected pursuant to Section 121 of the Tax Code, as amended. There is no law which prohibits the insurance companies to bill the 5% premium tax to the insured. Hence, we will not interpose any objection if the insurance companies will charge separately the premium tax to the insured as long as the same is paid to the Bureau of Internal Revenue."Following this ruling, the 5% premium tax (4% of which is a component of the present tariff rates) should not be included in computing the premium as said tax could be charged separately to the insured. The use of a revised format of premium billing in lieu of the present (also indicated) is hereby suggested.
Present | Format | Suggested Revised | Format | ||
Fire | Motor & Bonds | Fire | Motor & Bonds | ||
Premium | P100.00 | P100.00 | Premium | P96.00 | P96.00 |
1% P.T. | 1.00 | 1.00 | 5% P.T | 4.80 | 4.80 |
D/S | 7.50 | 7.50 | D/S | 7.20 | 7.20 |
2% F.S.T. | 2.00 | - | 2% F.S.T. | 1.92 | - |
------- | ------- | ------- | ------- | ||
P110.50 | P108.50 | P109.92 | P108.50 |