EIGHTEENTH CONGRESS OF THE ] 
REPUBLIC OF THE PHILIPPINES ] 
Second Regular Session 
]
SENATE
S.B. No. 2281
FLED
TIME
Introduced by SEN. WIN GATCHALIAN
AN ACT
IMPOSING TAXES ON OFFSITE BETTING ACTIVITIES 
ON LOCALLY LICENSED COCKFIGHTS AND DERBIES,
AMENDING SECTION 125 OF THE NATIONAL INTERNAL 
REVENUE CODE OF 1997, AS AMENDED
EXPLANATORY NOTE
"Sabong"ox the placing of bets on live cockfighting is an established tradition 
in the Philippines which has been present as far back as three thousand (3,000) years 
ago. With the advent of technology, it has evoived to prevalence of online platform 
where patrons can place bets or "E-Sabong," which has become more popular during 
the outbreak of the COVID-19 pandemic with the ciosure of physical cockpits. E- 
Sabong is defined as the online or remote or off-site wagering or betting on live 
cockfighting matches, events, and/or activities streamed by local government unit 
(LGU) having jurisdiction thereof.1
Under the current system, live cockfighting is reguiated by the LGU concerned 
whiie E-Sabong is regulated by the Philippine Amusement and Gaming Corporation 
(PAGCOR), which charges E-Sabong operators with a fixed regulatory fee amounting 
to oniy P12,500 per fight or a minimum guaranteed fee of P75 miiiion per month.
PAGCOR Regulatory Framework for Electronic Sabong (E-Sabong)


whichever is higher. However, with the rising popularity of E-Sabong, which 
consequently results to higher revenues for the operators, and declining tax revenues 
from other gaming activities, a clear tax regime for E-sabong is urgently needed.
Accordingly, this measure aims to impose franchise tax on transactions 
invoiving offsite betting activities on localiy licensed cockfights and derbies to provide 
a more transparent tax coiiection system and to recoup revenues foliowing the closure 
of casinos and gaming facilities due to the pandemic.
In view of the foregoing, passage of this bill is earnestly sought.
GATCHALIAN


EIGHTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session
SENATE 
S.B. No. 2281
FILED
NDtX
Introduced by SEN. WIN GATCHALIAN
AN ACT
IMPOSING TAXES ON OFFSITE BETTING ACTIVITIES 
ON LOCALLY LICENSED COCKFIGHTS AND DERBIES,
AMENDING SECTION 125 OF THE NATIONAL INTERNAL 
REVENUE CODE OF 1997, AS AMENDED
Be it enacted by the Senate and the House of Representatives of the Phiiippines 
in Congress assembied:
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SECTION 1. Section 125 of the National Internal Revenue Code of 1997, as amended,
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is hereby added to read as follows:
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"SEC. 125. Amusement Taxes. There shall be collected from the proprietor
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lessee and operator of cockpits, INCLUDING OPERATORS OF ONLINE
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PLATFORMS AND OFFSITE BETTING STATIONS FOR SUCH
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COCKPITS, cabarets, night or day clubs, boxing exhibitions, professional
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basketball games, Jai-Alai and racetracks, a tax equivalent to:
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(a) Eighteen percent (18%) in the case of cockpits: PROVIDED^ THAT
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FOR OFFSITE BETTING ACTIVITIES ON LOCALLY LICENSED
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COCKFIGHTS AND DERBIES AND OTHER DERIVATIVE ACTIVITIES,
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THERE SHALL BE LEVIED, ASSESSED, AND COLLECTED A TAX
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EQUIVALENT TO FIVE PERCENT (5%) BASED ON THE GROSS
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RECEIPTS WHICH SHALL BE DIRECTLY REMITTED TO THE BUREAU


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OF INTERNAL REVENUE (BIR) AND SHALL BE IN LIEU OF ALL 
OTHER PERCENTAGE TAXES PURSUANT TO SECTION 109 (1) (E), 
BUT NOT OF LOCAL GOVERNMENT TAXES AND REGULATORY FEES 
AND CHARGES APPLICABLE TO SUCH ACTIVITIES.
(b) XXX 
(C) XXX
(d) 
XXX
(e) 
XXX
For the purpose of the amusement tax, the term 'gross receipts' embraces 
all the receipts of the proprietor, lessee or operator of the amusement place. 
Said gross receipts also include income from television, radio and motion 
picture rights, if any. A person or entity or association conducting any 
activity subject to the tax herein imposed shali be similarly liable for said 
tax with respect to such portion of the receipts derived by him or it.
FOR PURPOSES OF SECTION 125 (a) HEREIN, THE TERM "GROSS 
RECEIPTS" EMBRACES ALL THE RECEIPTS DERIVED BY THE 
PERSON, ENTITY OR ASSOCIATION, INCLUDING INCOME 
DERIVED FROM 'PLASADA'OR NET COMMISSION FROM OFFSITE 
BETTING ON LOCALLY AUTHORIZED AND REMOTELY BROADCAST 
COCKFIGHTING MATCHES OF ALL GAMING OPERATORS.
"OFFSITE BETTING ACTIVITIES ON LOCALLY LICENSED 
COCKFIGHTS AND DERBIES" SHALL REFER TO ACTIVITIES BY 
GAMING OPERATORS, AS DEFINED IN THIS SECTION, WHICH 
INVOLVE PLACING AND ACCEPTANCE OF WAGERS, INCLUDING 
FACILITATION THEREOF, BY REMOTE AND/OR ELECTRONIC 
MEANS, ON COCKFIGHTING ACTIVITIES DULY AUTHORIZED AND 
LICENSED BY LOCAL GOVERNMENT UNITS (LGU) IN THE 
EXERCISE OF THEIR POWERS UNDER REPUBLIC ACT NO. 7160: 
PROVIDED, THAT WHENEVER APPLICABLE, OFFSITE BETTING 
STATIONS, ACTIVITIES OR OPERATIONS SHALL BE DULY


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AUTHORIZED OR LICENSED BY THE LGU IN WHICH THE 
STATIONS, ACTIVITIES, OR OPERATIONS ARE PHYSICALLY 
LOCATEDL PROVIDED, FURTHER, THAT OFFSITE BETTING, AS 
REFERRED TO IN THIS SECTION, SHALL NOT INCLUDE OTHER 
GAMES AND ACTIVIVIES SPECIFICALLY AUTHORIZED BY LAW TO 
BE PERFORMED BY OTHER GOVERNMENT GAMING AUTHORITIES, 
SUCH AS THE PHILIPPINE AMUSEMENT AND GAMING 
CORPORATION AND THE PHILIPPINE CHARITY AND 
SWEEPSTAKES OFFICE.
"GAMING OPERATOR" SHALL REFER TO A REGISTERED RESIDENT 
ENTITY, SUCH AS A CORPORATION, A PARTNERSHIP, AN 
INDIVIDUAL OR AN ASSOCIATION, DULY AUTHORIZED BY THE 
GAMES AND AMUSEMENT BOARD (GAB) TO SUPERVISE, MANAGE 
AND OPERATE OFFSITE BETTING ACTIVITIES ON LOCALLY 
LICENSED COCKFIGHTS AND DERBIES AS DEFINED IN THIS 
SECTION. WHEREVER APPLICABLE, OFFSITE BETTING ACTIVITIES 
ON LOCALLY LICENSED COCKFIGHTS AND DERBIES SHALL BE 
INCLUDED BY THE GAMING OPERATOR IN DISCLOSURES AND 
DOCUMENTATIONS REQUIRED BY THE BIR, THE GAB AND OTHER 
REGULATORY 
GOVERNMENT 
AGENCIES 
AND
INSTRUMENTALITIES."
The taxes imposed herein shall be payable at the end of each quarter and 
it shall be the duty of the proprietor, lessee or operator concerned, as well 
as any party liable, within twenty (20) days after the end of each quarter, 
to make a true and complete return of the amount of the gross receipts 
derived during the preceding quarter and pay the tax due thereon.
FOR THE EFFICIENT ASSESSMENT AND VERIFICATION OF TAX 
DUES AND TO ENSURE THE VIABILITY OF THE ACTIVITIES TAXED 
HEREIN AS A REVENUE SOURCE, THE GAB SHALL ISSUE RULES 
AND REGULATIONS FOR THE FAIR CONDUCT OF OFFSITE BETTING


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ON LOCALLY LICENSED COCKFIGHTS AND DERBIES, INCLUDING 
DEVICES REQUIRED OF GAMING OPERATORS, AGENTS, AND 
OTHER RELATED PARTIES: PROVIDED, THAT THE FOREGOING 
SHALL NOT PRECLUDE THE COMMISSIONER OF INTERNAL 
REVENUE FROM ISSUING SUCH RULES AND REGULATIONS AS 
MAY BE ALLOWED BY THE NATIONAL INTERNAL REVENUE CODE 
AND OTHER LAWS, RULES AND REGULATIONS.
SEC. 2. Implementing Rules and Regulations. - Within thirty (30) days after the 
effectivity of this Act, the Commissioner of Internal Revenue and the Chairperson of 
GAB shall promulgate the rules and regulations necessary for its implementation.
SEC. 3 Separability Clause. - If any part or provision of this Act is held invalid or 
unconstitutional, the remaining parts or provisions not affected shall remain in full 
force and effect.
SEC. 4. Repealing Clause. - All laws, decrees, orders, rules, and regulations 
inconsistent with the provisions of this Decree are hereby repealed or modified 
accordingly.
SEC. 5. Effectivity. - This Act shall take effect fifteen (15) days after its publication in 
the Official Gazette or in any newspaper of general circulation.
Approved,