Perfume Excise Tax Philippines: What You Must Know About the 20% BIR Rule (RR 9-2023)

Many entrepreneurs think perfumes are just another product to sell online or in stores. But what most don’t know is this: perfumes and colognes are luxury goods. And under BIR Revenue Regulation No. 9-2023, they are now subject to a 20% excise tax.

If you ignore this, the penalties don’t just hurt—they can shut down your business. Some sellers have lost hundreds of thousands because they weren’t aware.

Here’s the clear, simple guide to help you stay compliant.

Why Perfumes Are Taxed

Excise tax = a levy on luxury or non-essential goods
Perfumes are classified as non-essential
Purpose: raise government revenue and regulate use

The Rule in Simple Words

20% excise tax on perfumes and toilet waters
Locally produced → based on wholesale price (net of VAT & excise)
Imported → based on Customs value (net of VAT & excise)

Who Needs to Pay?

This applies to:

Manufacturers and producers
Importers and distributors
Retailers and online sellers caught with untaxed stock

Even small resellers aren’t exempt.

How Penalties Can Multiply

Perfumes worth ₱500,000 → Excise tax = ₱100,000.
If unpaid → ₱1,000,000 fine (10× the tax) plus confiscation of goods.

Lesson: excise tax is never optional.

Common Myths That Cost Business Owners

❌ “Retailer lang ako, exempt.”
❌ “Pwede i-understate ang presyo.”
❌ “Pwede nang ibenta kahit walang form.”
❌ “Hindi naman hinahanap ng BIR.”

All false. All dangerous.

The Form You Must File

BIR Form 2200-AN – Excise Tax Return for Automobiles and Non-Essential Goods

Must be filed before goods are released or removed
Submit via eFPS, eBIRForms, or Authorized Agent Bank

Permits You Cannot Skip

Permit to Operate (Non-Essential Goods) – from BIR Excise LT Regulatory Division (ELTRD) or Excise Area Office
Permit to Use Ethyl/Denatured Alcohol – from ELTFOD if you use alcohol in production
ATRIG (Authority to Release Imported Goods) – required before imported perfumes leave Customs
ETRD (Form 2299) – clearance for removals from factory or warehouse

No permits = goods presumed untaxed.

Records the BIR Will Check

Sworn Statement (every June & December, or if price changes)
Official Register Books (ORB) and monthly transcripts (due every 8th)
Initial Inventory Report (file within 15 days of effectivity)

Quick Compliance Roadmap

Register and secure the required permits
File BIR Form 2200-AN before release or removal
Keep and submit sworn statements & ORBs on time
Always pay excise tax before your goods move out

Where and When to File

Where: File with your home RDO, pay through Authorized Agent Banks (AABs).
If no AAB, pay through a Revenue Collection Officer or LGU Treasurer.
When:
- Excise Tax → before release/removal
- Sworn Statement → June & December
- ORB transcripts → every 8th of the month
- Inventory Report → within 15 days of effectivity