LEVYING A SURTAX ON EXTRAORDINARY GAINS REALIZED BY OIL COMPANIES FROM PETROLEUM PRODUCTS.

• Number: Presidential Decree No. 1889
• Sections: 8

Preamble

WHEREAS, the immediate price increases on the whole range of

refined or blended petroleum products have brought about extraordinary gains for

oil companies on account of the sale at higher prices of finished products,

processed from crude oil and other base stocks, purchased or acquired by them

before the price adjustment; and

WHEREAS, a part of such extraordinary and "unearned" gains

should be utilized for benefit of a greater, number .of our people.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the

Philippines, by virtue of the powers vested in me by the Constitution, do hereby

decree and order the following:

Section 1 Surtax on Extraordinary Gains; Rate of Surtax.

SECTION 1. Surtax on Extraordinary Gains; Rate of

Surtax. — In addition to the income tax imposed under Title II of the

National Internal Revenue Code, there is hereby imposed a surtax of sixty-five

(65%) per cent on extra-ordinary gains realized by oil companies as a result of

prices increases authorized for petroleum products which surtax shall be allowed

as part of the cost of petroleum product sold on or after November 3, 1983.

Section 2 Computation of Extraordinary Gains.

SEC. 2. Computation of Extraordinary Gains. — The

extraordinary gains shall be measured by the difference between the approved

wholesale posted prices of refined petroleum products immediately before the

authorized price increases and the new posted prices multiplied by the number of

units of petroleum products existing as of the day of effectivity of the price

increases. Extraordinary gains shall also refer to the aggregate increases in

the value of crude oil and base stocks.

Section 3 Time, Manner and Place of Payment.

SEC. 3. Time, Manner and Place of Payment. — The

surtax herein imposed shall be paid within thirty (30) days following- the

promulgation of this Decree. The rules and regulations authorized under Section

5 hereof may provide for installment payments.

A return shall be filed at the time of payment with the Commissioner of

Internal Revenue.

Section 4 Penalties.

SEC. 4. Penalties. — Failure to pay the tax and

file the corresponding tax return as hereinabove specified, as well as any other

violations of this Decree, shall be subject to surcharges, interests and

penalties provided under Title II of the National Internal Revenue Code.

Section 5 Rule and Regulations.

SEC. 5. Rule and Regulations. — The Minister of

Finance upon recommendation of the Commissioner of Internal Revenue and in

consultation with the Minister of Energy shall promulgate rules and regulations

to implement the provisions of this Decree.

Section 6 Repealing Clause.

SEC. 6. Repealing Clause. — All acts, decrees,

executive and administrative orders and other issuances which are inconsistent

herewith, are hereby repealed or modified accordingly.

Section 7 Effectivity.

SEC. 7. Effectivity. — This Decree shall take effect

immediately.

Done in the City of Manila, this 3rd day of November nineteen hundred and

eighty-three.

(Sgd.) FERDINAND E. MARCOS

President of

the Philippines