Republic of the Philippines ;

HOUSE OF REPRESENTATIVES <

Quezon City ‘ie TIME: 24

A

NINETEENTH CONGRESS
First Regular Session

HOUSE BILCNo. 3836

Introduced by REP. LEX ANTHONY CRIS A. COLADA

EXPLANATORY NOTE

Power of Taxation as one of the inherent powers of the State plays a vital role in nation-
building. Article VI, Section 28 of the Constitution states that "the rule of taxation shall be uniform
and equitable” and that "Congress shall evolve a progressive system of taxation.”

One of the fast-growing industries today on account of advance technology is the online
betting activities and games. Technology makes new experiences available for gamblers/players
and at the same time making it easier and safer to play online.

To date, there is no clear tax regime on activities of electronic betting. We, at Congress
should be responsible in regulating these online betting games and ensure that all the legal
activities therein be properly regulated where the end goal is for the State and public to benefit
from it. It is this representation’s belief that if our existing onsite betting games/activities are
currently being taxed, it is indeed just right to impose taxes on offsite betting activities, both of
it being an equal activity only that the platform differs.

This bill seeks to impose a tax regime on “Offsite Betting Activities on Locally Licensed
Games,” with the ultimate goal of maximizing the revenue-generating capacity of the national
government but without overstepping on the powers and functions of the local governments as
well as government gaming agencies.

In view of the benefit that the government may receive from this bill, and ultimately
redounding to the benefit of the State, the approval of this proposal is urgently so.

LEX ANTHONY CBIS A. COLADA
Aambis-OWA, Partylist


Republic of the Philippines
HOUSE OF REPRESENTATIVES
‘Quezon City

NINETEENTH CONGRESS
First Regular Session

HOUSE BILL nod 836

Introduced by REP. LEX ANTHONY CRIS A. COLADA

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 House of Representatives of the Philippines in
Congress assembled:

1 SECTION 1. Section 125 of the National Internal Revenue Code of 1997, as 2 amended, is
hereby further amended to read as follows: 3

4 "SEC. 125. Amusement Taxes. There shall be collected from the
5 proprietor, lessee and operator of cockpits, INCLUDING OPERATORS
6 OF ONLINE PLATFORMS AND OFFSITE BETTING STATIONS FOR
7 SUCH COCKPITS, cabarets, night or day clubs, boxing exhibitions, 8

professional basketball games, Jai-Alai and racetracks, a tax 9
equivalent to:

10

1 (a) Eighteen percent (18%) in the case of cockpits: PROVIDED, THAT
12 FOR OFFSITE BETTING ACTIVITIES ON LOCALLY LICENSED
13 COCKFIGHTS AND DERBIES AND OTHER DERIVATIVE

14 ACTIVITIES, THERE SHALL BE LEVIED, ASSESSED, AND

15 COLLECTED A TAX EQUIVALENT TO FIVE PERCENT (5%)


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BASED ON GROSS GAMING RECEIPTS, WHICH SHALL BE
DIRECTLY REMITTED TO THE BUREAU OF INTERNAL
REVENUE (BIR) AND SHALL BE IN LIEU OF ALL OTHER
PERCENTAGE TAXES PURSUANT TO SECTION 10914E
BUT NOT OF LOCAL GOVERNMENT TAXES AND 6
REGULATORY FEES AND CHARGES APPLICABLE TO
SUCH 7 ACTIVITIES.

(b) xxx
{c) 0x
(d) 0x
(e) xxx

For the purpose of the amusement tax, the term ‘gross receipts’
embraces all 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 22
shall be similarly liable for said tax with respect to such portion of the 23
receipts derived by him or it.

FOR PURPOSES OF SECTION 125 (a) HEREIN, THE TERM
"GROSS GAMING RECEIPTS' EMBRACES ALL THE RECEIPTS
DERIVED BY THE PERSON, ENTITY OR ASSOCIATION,
INCLUDING INCOME DERIVED FROM 'PLASADA' OR NET

29 COMMISSION FROM OFFSITE BETTING ON LOCALLY 30
AUTHORIZED AND REMOTELY BROADCAST COCKFIGHTING 31
MATCHES OF ALL GAMING OPERATORS.

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"OFFSITE BETTING ACTIVITIES ON LOCALLY LICENSED
COCKFIGHTS AND DERBIES" SHALL REFER TO ACTIVITIES BY


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weorau

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 (/-GU) IN THE 40
EXERCISE OF THEIR POWERS UNDER REPUBLIC ACT NO. 7160:
PROVIDED THAT, WHENEVER APPLICABLE, OFFSITE BETTING
STATIONS, ACTIVITIES, OR OPERATIONS SHALL BE DULY

AUTHORIZED OR LICENSED BY THE I-GU IN WHICH THE
STATIONS, ACTIVITIES, OR OPERATIONS ARE PHYSICALLY
LOCATED: PROVIDED, FURTHER, THAT OFFSITE BETTING, AS
REFERRED TO IN THIS SECTION, SHALL NOT INCLUDE OTHER

GAMES AND ACTIVITIES SPECIFICALLY AUTHORIZED BY LAW
TO BE PERFORMED BY OTHER GOVERNMENT GAMING
AUTHORITIES SUCH AS THE PHILIPPINE AMUSEMENT AND
50 GAMING CORPORATION AND THE PHILIPPINE CHARITY
ANDS1 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


10 DISCLOSURES AND DOCUMENTATIONS REQUIRED BY THE

BIR,
u THE GAB AND OTHER REGULATORY GOVERNMENT
AGENCIES
12 AND INSTRUMENTALITIES.”

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The taxes imposed herein shall be payable at the end of each quarter 15
and it shall be the duty of the proprietor, lessee or operator concerned,

16 as well as any party liable, within twenty (20) days after the end of

7 each quarter, to make a true and complete return of the amount of the 18
gross receipts derived during the preceding quarter and pay the tax 19
due hereon.

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21 THE COMMISSIONER OF INTERNAL REVENUE SHALL ISSUE

22 RULES AND REGULATIONS AS MAY BE ALLOWED BY THE 23
NATIONAL INTERNAL REVENUE CODE AND OTHER LAWS, 24 RULES,

AND REGULATIONS.

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26 SEC. 2. Implementing Rules and Regulations. — Within thirty (30) days after
27 the effectivity of this Act, the Commissioner of Internal Revenue and the

Chairperson 28 _of the GAB shall promulgate the rules and regulations
necessary for its 29. implementation.
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31 SEC. 3. Separabiljty Clause. — If any part or provision of this Act is held invalid 32 or
unconstitutional, the remaining parts or provisions not affected shall remain in full 33 force
and effect.
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35 SEC. 4. Repealing Clause. — Alll laws, decrees, orders, rules, and regulations 36
inconsistent with the provisions of this Act are hereby repealed or modified 37
accordingly.
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39 SEC. 5. Effectivity. — This Act shall take effect fifteen (15) days after its 40 publication in
the Official Gazette or in any newspaper of general circulation.
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42 Approved,