House panel OKs substitute bill imposing taxes on online cockfighting, derbies

The House committee on ways and means on Monday approved the unnumbered substitute bill for the measure imposing new taxes on online locally-licensed cockfights and derbies.

During its meeting, the panel approved the substitute measure for House Bill 7919, which seeks to amend Section 125 of the National Internal Revenue Code of 1997.

House Bill 7919, filed by committee chair Joey Salceda, was approved by the same committee "in principle" last week.

Under the substitute measure, a tax equivalent to 5% based on gross receipts from offsite betting activities on locally-licensed cockfights and derbies will be imposed on online cockfighting operators, to be remitted directly to the Bureau of Internal Revenue (BIR).

This tax, however, should not be in lieu of local government taxes and regulatory fees and charges applicable to such activities.

The measure defines "offsite betting activities on locally-licensed cockfights and derbies" as cockfighting activities that involve placing, acceptance, and facilitation of wagers through remote or electronic means and licensed by local government units.

Offsite betting, however, does not include games and activities authorized by law to be performed by other gaming authorities such as the Philippine Amusement and Gaming Operation and the Philippine Charity Sweepstakes Office.

Meanwhile, "gross receipts" include all receipts including income derived from "plasada" or net commission from offsite betting on locally authorized and remotely broadcast cockfight matches.

The measure mandates the Games and Amusement Board to issue the rules and regulations for the fair conduct of offsite betting on locally-licensed cockfights and derbies, including devices to be used by gaming operators and agents.

In filing the measure, Salceda said its primary goal is to make the industry of online sabong and other related games more transparent and accountable.

“The operations of online betting on sabong are authorized by local ordinances. Because of the digital shift, there are now electronic betting operations on such games. But the electronic aspect of it is a gray area, even though the airwaves is national property," he said.

"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 P13.7 million in 2019,” he added.—AOL, GMA News