The Taxes of the Local Government Units

First of all, here are what the LGU's can't  impose taxes on:

1.) Income tax, except if levied on banks and other financial institutions

2.) Documentary stamp tax

3.) Taxes on estates, gifts, inheritance, legacies and other transfers mortis causa except otherwise provided in the Local government Code

4.) Customs duties, registration fees of vessels, wharfage dues on wharves, tonnage dues and all other kinds of customs fees and charges, except wharfage on wharves built by the LGU

5.) Taxes, fees, charges and other impositions on goods carried into, out of or passing through the territorial jurisdiction of the LGU in the guise of wharfage, bridge tolls or otherwise, or other taxes, fees and charges in any form whatsoever upon said goods or merchandise

6.) Taxes, fees or charges on agricultural or aquatic products sold by marginal farmers or fishermen

7.) Taxes on business enterprises certified to by the Board of Investments as pioneer (6 years) or non-pioneer (4 years) from date of registration

8.) Excise taxes on articles listed in the National Internal Revenue Code, as well as taxes, fees or charges on petroleum products

9.) VAT or percentage taxes on sales, barters, exchanges or similar transactions on goods and services unless otherwise provided

10.) Taxes on gross receipts of transportation contractors and persons engaged in the transportation of passengers or freight by hire of common carriers by land, air or water, except as otherwise provided

11.) Taxes on premiums paid by way of reinsurance or retrocession

12.) Taxes, fees or charges for the registration of motor vehicles and for the issuance of all kinds of licenses of permits for driving these vehicles (except tricycles)

13.) Taxes, fees or charges on Philippine products actually exported, except as otherwise provided

14.) Taxes, fees or charges on countryside, BMBEs and cooperatives duly registered

15.)Taxes, fees or charges of any kind on the national government, its agencies and instrumentalities, and LGUs
16.) Special assessments on land

Provincial Taxes

These are the only taxes the province can raise. It can't make others:

1.) Tax on transfer of real property ownership

Shouldn't be more than 1/2 of 1% of the total selling price or fair market value, whichever is higher. The seller, donor, transferor, executor or administrator will pay the tax within 60 days from the date of transfer or of the decedent's death. Transfers under CARP and  mortis causa are excluded.

2.) Tax on business of printing and publication

Can't be more than 1/2 of 1% of gross receipts for the preceding calendar year; the rate of a newly-started business can't exceed 1/20 of 1 % of the capital investment for the 1st calendar year. This tax covers printing presses that publish books, print cards, posters, handbills, leaflets, certificates, receipts and other similar items but doesn't include newspaper and magazine publishing as well as books and other materials prescribed by the DEPED.

3.) Franchise Tax

Not more than 1/2 of 1% of gross receipts for the preceding calendar year; provided a newly-started business is only liable for 1/20 of 1% of the capital investment for the1st calendar year. This covers all businesses enjoying franchises notwithstanding any exemption granted by law

4.)  Tax on sand, gravel and other quarry products

Not more than 10% of the fair market value in the locality per cubic meter of ordinary stones, sand, earth and other quarry resources extracted from public lands and from seabeds, rivers, streams, creeks and other public waters within its territorial jurisdiction. Distribution of the proceeds are as follows: 30% to the province, 30% to the city or municipality from where the quarry resources were extracted and 40% to the barangay from where the quarry resources were extracted.

5.) Professional Tax

Not more than Php300 per year for each profession covering persons who practice a profession that requires a government exam, including those who are employed (government employees are exempt.) This tax can be imposed by highly urbanized and independent component cities.

6.) Amusement Tax

Not more than 10% of gross receipts from admission fees; withheld in the case of theaters or cinemas. Operas, concerts, dramas, recitals, painting and art exhibitions, flower shows, musical programs, literary and oratorical presentations are exempt (except pop and rock concerts.) This can be imposed by highly urbanized and independent component cities. Distributions is 50% to the province and 50% to the municipality; cities get 100%.

7.) Fixed tax for delivery truck/van of manufacturers, producers, wholesalers, dealers or retailers of alcoholic beverages, softdrinks, cigars, cigarettes and other products determined by the sangguniang panlalawigan for delivery to sales outlets or consumers within the province. The tax is Php500 per truck/van per year. Once taxed, the taxpayer isn't subject to the tax on peddlers. This tax can also be imposed by highly urbanized and independent component cities.

Municipal Taxes

The municipality can't impose the provincial taxes but collects them as an agent of the province. It has its own taxes to collect and can even impose a business tax of up to 2% of gross sales per calendar year even if the businesses in question are already subject to VAT. Below are the taxing powers of the municipality:

1.) Manufacturers, assemblers, packers, brewers, distillers, rectifiers and compounders of alcoholic beverages or any article of commerce of whatever nature or kind. This is graduated, starting from Php165  per year on gross sales/receipts of less than Php10,000.00 up to a maximum of 37 1/2% (yes, 37 and 1/2%!) of 1% of gross sales/receipts of Php6,500,000.00 or more.

2.) Wholesalers, distributors or dealers of any kind or nature of article of commerce. Also graduated, starting with Php18.00 per year on gross sales/receipts of less than Php1,000.00 up to a maximum of 1/2 of 1% on gross sales/receipts of Php2,000,000.00 or more.

3.) Exporters, manufacturers, millers, producers, wholesalers, distributors, dealers or retailers of essential commodities at a rate not exceeding 1/2 of the rates in 1, 2 and 4. Essential commodities include the following:

a.) Rice and corn
b.) Wheat, cassava flour, meat, dairy products, locally manufactured, processed or preserved food, sugar, salt and other agricultural, marine and fresh water products whether in their original state or not (this includes ice cream, coffee and tea)
c.) Cooking oil and gas
d.) Agricultural implements, equipment and post-harvest facilities, fertilizers, pesticides and insecticides, herbicides and other farm inputs
e.) Poultry and other animal feeds
f.) School supplies
g.) Cement

4.) Retailers: 2% on annual gross sales/receipts of Php400,000.00 or less and 1% of the excess over Php400,000.00; but if the annual gross sales/receipts is Php30,000.00 or less (for a municipality) or Php50,000.00 or less (for a city,) the barangay will collect the tax.

5.) Contractors, whether independent or not: graduated, beginning at Php27.50 per year on gross receipts of less than Php5,000.00 up to 1/2 of 1% on gross receipts of Php2,000,000.00 or more.

6.) Banks and other financial institutions: maximum of 1/2 of 1% on gross receipts derived from interest, commissions and discounts from lending activities, income from financial leasing, dividends, rentals on property and profit from exchange or sale of property and insurance premiums.

7.) Peddlers engaged in the sale of any merchandise or article of commerce: maximum of Php50.00 per year.

8.) Any business the municipal sanggunian considers proper to tax: provided any business subject to excise, VAT or percentage taxes under the tax code shall be imposed a rate of up to 2% on gross sales/receipts of the preceding calendar year.

City Taxes

The city is the most powerful of all the LGUs as far as taxation is concerned. All taxes imposed by city ordinance can be collected by the city and none of it is remitted to the province. The city has the power to impose the 7 provincial taxes as well as the municipal ones with an additional 50% of the maximum rates imposed.

Barangay Taxes

The barangay can collect only 1 tax, regardless of whether it's located in a city or municipality; a maximum of 1% on gross annual sales/receipts if they don't exceed Php30,000.00 (if in a municipality) or Php50,000.00 (if in a city.) The barangay's other income-generating sources are fees and charges on the following:

1.) Use of barangay-owned properties or service facilities, like dryers for tobacco, copra and palay.
2.) Commercial breeding of fighting cocks with an annual sale of more than 5 fighting cocks from a duly registered breeder, as well as on cockfights and cockpits.
3.) Places or recreation which charge admission fees
4.) Billboards, signboards, neon signs and outdoor advertisements
5.) Clearance for any business or activity within the barangay.