Section 1
SECTION 1. That Section 255 of the National Internal Revenue Code is hereby amended to read as follows: "SEC. 255. Taxes on insurance premium. - There shall be collected from every person, company, or corporation (except purely cooperative companies or associations) doing insurance business of any sort in the Philippines a tax of FOUR per centum of the total premiums collected, whether such premiums are paid in money, notes, credits or any substitute for money; but premiums refunded within six months after payment on account of rejection of risk or returned for other reason to a person insured shall not be included in the taxable receipts; nor shall any tax be paid upon reinsurance by a company that has already paid the tax; nor upon premiums collected or received by any branch of a domestic corporation, firm or association doing business outside the Philippines on account of life insurance of the insured who is a non-resident, if any percentage tax on such premiums is imposed by the foreign country where the branch is established; nor upon premiums collected or received on account of reinsurance, if the risk insured against covers property located outside the Philippines, or the insured, in case of personal insurance, resides outside the Philippines, if any percentage tax on such premiums is imposed by the foreign country where the original insurance has been issued or perfected; NOR UPON THAT PORTION OF THE PREMIUMS COLLECTED OR RECEIVED BY INSURANCE COMPANIES ON VARIABLE CONTRACTS (AS DEFINED IN SECTION 232 (2) OF PRESIDENTIAL DECREE NO. 612) IN EXCESS OF THE AMOUNTS NECESSARY TO INSURE THE LIVES OF VARIABLE CONTRACT OWNERS. "Cooperative companies or associations are such as are conducted by the members thereof with the money collected from among themselves and solely for their own protection and not for profit."