House panel OKs imposition of taxes on electronic sabong betting (Sabong News)
Author
Ben Rosario
Date
NOVEMBER 17 2020
House Committee on Ways and Means on Tuesday, Nov. 17, approved in principle the imposition of taxes on electronic sabong to support the government’s need for more funds while also “building up” the culture of gambling in the country.
In a virtual commitee meeting presided by Albay Rep. Joey Sarte Salceda, the House panel also agreed to assign the Games and Amusement Board, currently chaired by former Palawan Rep. Abraham Mitra, to be the chief regulator of the e-sabong games.
Acting on a motion by APEC Partylist Rep. Sergio Dagooc, the Ways and Means panel agreed to approve House Bill 7919 in principle. AAMBIS OWA Rep. Sharon Garin is drafting the final provisions of the measure, which seeks to impose a five-percent tax on gross revenues derived from online gambling and off-site betting activities for cockfighting granted license by local government units (LGUs).
HB 7919 is a purely tax measure that does not include provisions that neither regulate cockfight bettings as a gambling activity nor limit the qualification of who can bet.
Since betting can be done online, it is also expected to give cockfight gambling operators the latitude to operate beyond the boundaries of the LGU that granted the cockfight license, it was gathered.
Salceda noted that LGUs have authorized the operation of online or internet betting on cockfighting as a result of the “digital shift.”
“But the electronic aspect of it is a gray area, even though the airwaves is national property. Because of this ambiguity, we are unable to levy national taxes on these activities. By clarifying this gray area in my proposal, we hope to raise multiples more in revenues than the BIR collection from cockpits of P13.7M in 2019,” he explained.
Salceda stressed that, under the bill he authored, the five percent tax impositiion will not be in lieu of taxes required by the LGUs, and regulatory fees and charges imposed by government agencies.
He assured LGUs that they will still have full regulatory and revenue collecting powers over in-premise games and betting.
During the meeting, Nueva Ecija Rep. MIcaela Violago noted that online gambling is already being offered by the Philippine Amusement and Gaming Corporation without clear government regulation on taxation.
“I just want [that] all online gaming will be regulated so that the government can collect proper taxes,” she said.
BIR Deputy Commissioner Arnel Guballa said the revenue agency admits that cockpit operations is considered a “hard to tax area” because they lack the personnel to check betting activities and other profitable operations.
Government is entitled to 18 percent tax on gross winnings of bettors but BIR personnel find this difficult to impose.
“The regulatory checks that this bill establishes will also provide the government with more tools to regulate and monitor these activities, and verify tax assessments,” Salceda stated.
“While the government seeks new revenue streams to fund its COVID-19 priorities, this bill responds to this government need by imposing new national government taxes on activities that already exist and will undoubtedly continue to exist as digital technologies grow more sophisticated, but are not being imposed such taxes,” he explained.
