Republic of the Philippines
HOUSE OF REPRESENTATIVES
Constitution Hills, Quezon City

TWENTIETH CONGRESS
First Regular Session

House Bill No.. 141

Introduced by: REPRESENTATIVE ERIC L, OLIVAREZ

EXPLANATORY NOTE

Under Presidential Decrees (PD) Nos. 1067-A, 1067-B, 1067-C, as
amended by PD Nos. 1399, 1632, 1869, and Republic Act No. 9487, the
Philippine Amusement and Gaming Corporation (PAGCOR) has the following
mandates:

1. To regulate, operate, authorize, and license games of chance, games of
cards and games of numbers, particularly casino gaming;

2. To generate revenues for the government’s sovio-civic and national
development programs; and

3. To help promote the tourism industry.

With its mandates, PAGCOR has made significant contribution to
nation building, addressing poverty alleviation, peace and order restoration,
health and education improvement, and arts, culture, and sports
development, among others, with its programs and projects.

By virtue of PD 1869, PAGCOR also shares its earnings to Local
Government Unit (LGUs) for hosting Casino Filipino branches. PAGCOR
operates ten (10) casino branches in major cities in the country, aside from
mini casinos, slot machine, arcades, and PAGCOR clubs. These casinos are
Casino Filipino in Manila Pavillon, Malate, Angeles, Bacolod, Cebu, Davao,
Iloilo, Laoag, Olongapo, and Tagaytay.

Unlike other PAGCOR’s mandatory contributions which percentages or
amounts were specifically stated in their respective legislations, the host
cities’ share is not fixed in PD 1869. The amount thereof is dependent on the
approval of the PAGCOR Board of Directors.

The share PAGCOR’s earning is likewise limited to cities where PAGCOR
conducts its gaming operations through Casino Filipino. Cities where casinos
were being operated by franchises, nonetheless, were not given host shares.


It its noteworthy that franchise holder are only liable to pay a Franchise
Tax of five percent (5%) of the gross revenue or earnings derived from its
operation under the franchise and such tax is in lieu of all kinds of taxes,
levies, fees, or assessment of any kind, nature or description, levied,
established or collected by any municipal, provincial, or national government
agency. Consequently, cities, where these franchises are located lose their
taxing power over the said establishments and activities which entitles them
to receive their share in PAGCOR’s carnings.

“THE ABOVE FIVE PERCENT (5%) FRANCHISE TAX SHALL BE REMITTED
AS FOLLOWS: THREE PERCENT (3%) TO THE NATIONAL GOVERNMENT
AND TWO PERCENT (2%) TO THE LOCAL GOVERNMENT UNIT (LGU)
WHERE PAGCOR-OPERATED AND LICENSED GAMING OPERTIONS SUCH
AS, BUT NOT LIMITEND TO, LAND-BASED CASINOS, ONLINE CASINOS,
BINGO, ELECTRONIC GAMES (EGAMES), AND ELECTRONIC BINGO
(EBINGO) ARE LOCATED: PROVIDED, THAT THE TWO PERCENT (2%)
SHARE SHALL BE PAID DIRECTLY TO THE LGU CONCERNED.”

This Bill, therefore, earnestly seeks for the fixing of host city’s shares
on PAGCOR’s earnings.

ERIC L, OLIVAREZ


dRepublic of the Philippines
HOUSE OF REPRESENTATIVES
Constitution Hills, Quezon City

TWENTIETH CONGRESS
First Regular Session

House Bill No. 141

Introduced by: REPRESENTATIVE ERIC L. OLIVAREZ

AN ACT FIXING THE SHARE OF LOCAL GOVERNMENT UNIT (LGU)
HOSTING GAMING OPERATION LICENSED OR OPERATED BY THE
PHILIPPINE AMUSEMENT AND GAMING CORPORATION (PAGCOR) IN
THE PROCEEDS OF THE FRANCHISE TAX, FURTHER AMENDING
SECTION 12 OF PRESIDENTIAL DEGREE NO. 1869, AS AMENDED

Be it enacted by the senate and House of Representatives of the Philippines in
Congress assembled:

SECTION 1. Section 12 of Presidential Decree No. 1869 is hereby
further amended to read as follows:

“Sec. 12. Special Condition of Franchise. - After deducting five
percent (5%) as Franchise Tax, the fifty percent (50%) share of the government
in the [aggregate gross earnings] GROSS GAMING REVENUE of the
Corporation from this Franchise, or 60% if the [aggregate gross earnings]
GROSS GAMING REVENUE be less than P150,000,000,00, shall immediately
be set aside and shall accrue to the General Fund to finance the priority
infrastructure development project and to finance the restoration of damaged
or destroyed facilities due to calamities, as may be directed and authorized
by the office of the president of the Philippines.

“THE ABOVE FIVE PERCENT (5%) FRANCHISE TAX SHALL BE
REMITTED AS FOLLOWS: THREE PERCENT (3%) TO THE NATIONAL
GOVERNMENT AND TWO PERCENT (2%) TO THE LOCAL GOVERNMENT
UNIT (LGU) WHERE PAGCOR-OPERATED AND LICENSED GAMING
OPERTIONS SUCH AS, BUT NOT LIMITEND TO, LAND-BASED CASINOS,
ONLINE CASINOS, BINGO, ELECTRONIC GAMES (EGAMES), AND
ELECTRONIC BINGO (EBINGO) ARE LOCATED: PROVIDED, THAT THE
TWO PERCENT (2%) SHARE SHALL BE PAID DIRECTLY TO THE LGU
CONCERNED.”

SEC. 2. If any provision of this Act is declared invalid or unconstitutional, the
other provisions not affected thereby shall remain valid and subsisting.


SEC. 3. Section 12 of P.D. No. 1869, entitled: “Consolidating and Amending
Presidential Decree Nos. 1067-A, 1067-1399 and 1632, Relative to the
Franchise and Powers of the Philippine Amusement and Gaming Corporation
(PAGCOR),” as amended by Presidential Decree No. 1993, entitled: Amending
Section Twelve of Presidential Decree No. 1869 Consolidating and Amending
Presidential Decree Nos. 1067-A, 1067-B, 1067-C, 1399, and 1632, Relative
to the Franchise and Powers of the Philippine Amusement and Gaming
Corporation ( PAGCOR),” and all laws, executive orders, memorandum
circulars, guidelines, and other issuances or parts thereof, which are
inconsistent with this Act, are hereby repealed or modified accordingly.

SEC 4. This Act take effect fifteen (15) days after its publication in the official
Gazette or a newspaper of general circulation.

Approved,