The Bureau of Internal Revenue on Monday reiterated taxes charged on lotto also apply to small town lottery and that the Philippine Charity and Sweepstakes Office is responsible for its their collection and remittance/
BIR Commissioner Kim Henares said PCSO was liable to pay the documentary stamp tax on its STL operation because it was the actual issuer of the STL tickets, contrary to earlier reports.
Henares said the agency had not cleared any party, including the PCSO, of any liability over the unsettled DST, which was estimated at close to P3 billion.
“We have not cleared them [PCSO] of any responsibility. The DST is the responsibility of the PCSO, and they should pay it,” Henares said.
“If I recall, with the STL, tickets are being issued by the PCSO. The ticket is PCSO’s primary liability, they have to remit it [taxes] to us,” she added.
The BIR, the largest revenue-collecting agency, cited a ruling of the Court of Tax Appeals that affirmed the PCSO was liable for DST in the sale of lotto tickets.
The CTA declared PCSO responsible in the payment of the DST on its lottery operations, saying Republic Act 1169 did not exempt the company from the tax. The Supreme Court declared the CTA decision final and executory, the BIR said.
Noting the similarities between the lottery and STL operations, the BIR stressed PCSO was liable for the DST on the sale of STL Tickets.
Earlier, PCSO general manager Jose Ferdinand Rojas II said his office had not received any “adverse opinion” on the DST from the BIR or the Commission on Audit.
Nina Asuncion of the BIR legal department said during a hearing conducted by the House committee on ways and means on Feb. 2 that the payment of DST was the sole responsibility of private companies operating STL under a contract with PCSO.
However, Henares said Asuncion’s statement had been taken out of context.
“That BIR representative who said something could have been taken out of context. I don’t even know what she said exactly,” Henares said.
Based on PCSO’s own computations, the two-year unpaid DST of the anti-jueteng gaming operation in 2013 and 2014 had reached P879.40 million, covering the 10 percent levy on betting tickets.
Under the National Internal Revenue Code, a P0.10 documentary stamp tax is charged for every P1 bet in jai alai, horse race, lotto or other authorized numbers games, like STL.
Henares said the BIR was conducting a separate audit on ticket sales of STL operators.
“They’re always being audited, and there are ongoing audits,” the BIR chief said.
STL was introduced by PCSO in 2005 as a legal alternative to “jueteng” and other illegal numbers games that have proliferated in many provinces and urban centers in the country.
However, instead of eradicating illegal gambling, certain STL companies were allegedly acting as mere fronts for jueteng, according to the Philippine National Police.
Revenues collected from STL under the PCSO charter are divided, with 55 percent going to the prize fund for the games, 30 percent for charity fund and PCSO obtaining 15 percent as its operating fund in the absence of any budget from the government.