RR No. 4-2018: Provides the rules and regulations implementing the Documentary Stamp Tax rate adjustment under RA No. 10963 (TRAIN Law)

Key points

1. Shares and certificates. DST on the original issue of shares rises from P1.00 to P2.00 on each P200 of par value. DST on sales or transfers of shares rises from P0.75 to P1.50 on each P200 of par value, and for stocks without par value it is 50% of the DST paid on the original issue.
2. Debt instruments and bills. DST on debt instruments rises from P1.00 to P1.50 on each P200 of issue price. DST on bills of exchange or drafts rises from P0.30 to P0.60 on each P200 of face value.
3. Checks and similar items. DST on bank checks, drafts, certificates of deposit not bearing interest and other instruments rises from P1.50 to P3.00. DST on certificates, warehouse receipts and proxies rises from P15.00 to P30.00.
4. Insurance, annuities and pre-need. Life insurance of P100,000 or less is exempt, and the one-time DST on higher amounts runs from P20.00 to P200.00 by bracket, doubled from before. Annuities rise from P0.50 to P1.00 on each P200, and pre-need plans from P0.20 to P0.40.
5. Other instruments. Leases rise from P3.00 to P6.00 for the first P2,000, with the additional tax rising from P1.00 to P2.00 per P1,000. Mortgages rise from P20.00 to P40.00 up to P5,000, with the additional tax rising from P10.00 to P20.00 per P5,000. Power of attorney rises from P5.00 to P10.00, and charter party rates are doubled.
6. Donations of real property. These are now subject to DST. Gifts exempt from Donor’s Tax under Section 101 (A) and (B), such as gifts to the National Government or to qualified non-profit educational, charitable, religious, cultural or social welfare institutions, are exempt from DST. For institutions, not more than 30% of the gift may be used for administration.

Who is affected

• Persons executing taxable documents and instruments subject to DST
• Donors of real property