Taxes Under Special Law - Charges on Forest Products

Forest charges are imposed for the privilege of exploiting the country’s forest resources as well as an instrument of environmental protection for sustainable development. These are applied to naturally
growing timber and forest products gathered within public forestlands, alienable and disposable lands and private lands. However, the cutting and manifestation of all mangrove species are prohibited. Forest charges collected shall be in lieu of the administrative charge on environment and other fees and charges imposed thereon.

Forest charges are collected per cubic meter on the following forest products:

1. Timber cut in forestland
a. First, second, third and fourth groups - 25% of actual Freight on Board (FOB) market price based on species and grading.
b. Pulpwood and matchwood - 10% of actual FOB market price.


2. Firewood, branches and other recoverable wood wastes of timber (such as timber ends, tops and stumps) when used as raw materials for the manufacture of finished products - PhP10.00 per cubic meter.

3. Minor forest products such as rattan, gums and resins, beeswax, guttapercha, almaciga resin and bamboo - 10% of actual FOB market price.

The following forest products are exempt from forest charges:
a. All other minor forest products not cited above; and
b. Planted trees and other forest products harvested from industrial tree plantation area and in private lands covered by existing land titles and approved land applications.

The actual FOB market price is determined once a year by the Secretary of Environment and Natural Resources, through a Committee created for the purpose.

Notes:  Trees harvested in compliance with timber license agreement’s (TLA’s) reforestation activities shall be subject to 30% government share based on gross sales of the timber, computed at the farm gate price as determined by the Regional Office concerned.