RR No. 12-2006: Promulgates the rules and regulations implementing the tax subsidy granted by the Fiscal Incentives Review Board to the Philippine National Police Service Store System

Key points

1. Scope of the subsidy. The privileges are limited to the products, amount, scope and period stated in the FIRB Resolution and the Certificate of Entitlement to Subsidy (CES) issued by the DOF. Other PNPSSS tax liabilities fall under the Tax Expenditure Subsidy rules in the 2005 Annual General Appropriations Act.
2. Funding and purchase orders. PNPSSS applies to the DBM for entitlement, and the DBM issues a Special Allotment Release Order (SARO) in favor of the Bureau of Treasury. No supplier may fill a purchase order unless an authorized PNPSSS official approves it, and that official’s name and specimen signature go to the CIR.
3. VAT procedure. PNPSSS applies through its RDO for a Tax Subsidy Availment Certificate (TSAC), attaching the purchase order and two copies of the supplier invoice or official receipt. The TSAC pays the VAT input tax, and the supplier uses the duplicate copy as payment of its VAT liability by attaching it to its VAT return.
4. Excise Tax procedure. The purchase order shows the tax base, Excise Tax due and total, and the RDO checks it before a TSAC is issued. Petroleum purchases from dealers are covered only if the dealer buys directly from local refiners, backed by a supply agreement stating the supply is exclusively for PNPSSS.
5. Liquidation and records. After delivery, PNPSSS submits acknowledged invoices and delivery receipts to the RDO, which will not process a new Excise Tax TSAC until the earlier one is fully liquidated. PNPSSS and its suppliers each keep a registered registry book, and PNPSSS files a Quarterly Summary List of Purchases and Input Tax in diskette form under RR No. 8-2002.

Who is affected

• Philippine National Police Service Store System
• Local manufacturers, producers and suppliers selling to PNPSSS

Deadlines and effectivity

• Sales entered in the registry book not later than the day after the transaction
• RDO monthly TSAC report to the Revenue Accounting Division within 15 days after month end