EXECUTIVE ORDER NO. 194
EXECUTIVE ORDER NO. 194 -
RESTRUCTURING THE TAXES OR AND PROVIDING FOR THE DISTRIBUTION OF
RECEIPTS IN HORSE RACING, AND FOR OTHER PURPOSES
WHEREAS,
there is a need to restructure the taxes on horse racing in order to
maximize their revenue productivity and optimize their contribution to
national economic recovery;
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, by
virtue of the powers vested in me by the Constitution, do hereby order:
Section 1. Distribution of gross receipts. — Any
provision of existing general or special law to the contrary
notwithstanding the total wager funds or gross receipts from the sale
of betting tickets in horse races shall be apportioned as follows;
eighty two (82%) per cent shall be distributed in the form of dividends
among the holders of winning tickets; eight and one-half (8-½%)
per cent shall be set aside as commission of the franchise grantee
conducting the horse races eight and one-half (8-½%) per cent
shall be set aside for the payment of stakes or prizes to winning
horses; and one (1%) per cent shall set aside for the use of the
Philippine Racing Commission: Provided, That in the case of gross
receipts derived from the total sale of tickets for pari mutuel races,
the one (1%) per cent government share shall be set aside for use of
the Games and Amusements Board.
Sec. 2. Stamp tax on horse race tickets. — On each
horse race ticket, there shall be collected a documentary stamp tax of
ten (P0.10) centavos: Provided, That if the cost of the ticket exceeds
one (P1.00) peso, an additional tax of ten (P0.10) centavos on every
one (P1.00) peso or fractional part thereof shall be collected:
Provided, further, That in the case of double, forecast/quinella and
trifecta bets, the tax shall be five (P0.05) centavos on every one
(P1.00) pesos worth of ticket.
Sec. 3. Tax on Winning. — Every person who wins in
horse races shall pay a tax equivalent to ten (10%) per cent of his
winnings or “dividends,” the tax to be based on the actual amount paid
to him for every winning ticket after deducting the costs of the
tickets: Provided, That in the case of winnings from double,
forecast/quinella and trifecta bets, the tax shall be four (4%) per
cent. In the case of owners of winning race horses, the tax shall be
ten (10) per cent of the prizes.
The tax herein prescribed shall be deducted from the “dividends”
corresponding to each winning ticket or the “prize” of each winning
race horse owner and withheld by the operator, manager, or person in
charge of the horse races before paying the dividends or prizes to the
persons entitles thereto.
The operator, manager, or person in charge of horse races shall, within
twenty (20) days from the date the tax was deducted and withheld in
accordance with the second paragraph hereof, file a true and correct
return with the Commissioner of the Bureau of Internal Revenue in the
manner or form to be prescribed by the Secretary of Finance, and pay
within the same period the total amount of tax so deducted and
withheld.
Sec. 4. The taxes herein prescribed shall be
subject to review by the Secretary of Finance after eighteen (18)
months from the date of effectivity and implementation of this
Executive Order. If, after review, the level of government revenue from
horse racing is equal to or higher than that corresponding to the
eighteen (18) months immediately preceding the effectivity of this
Executive Order, the tax structure for horse racing herein prescribed
shall become permanent, otherwise, the taxes imposed under the National
Internal Revenue Code, as amended, and the distribution of gross
receipts from the sale of betting tickets in horse races under Republic
Act Nos. 6631 and 6632 shall be automatically restored.
Sec. 5. The Secretary of Finance shall promulgate
the necessary rules and regulations to implement this Executive Order.
Sec. 6. Subject to the provisions of Sec. 4
hereof, Section s 203 and 229 of the National Internal Revenue Code, as
amended; and all laws, orders, issuances, and rules and regulations or
parts thereof inconsistent with this Executive Order are hereby
repealed or modified accordingly.
Sec. 7. This Executive Order shall take effect
immediately.
Done in the City of Manila,
this 16th day of June, in the year of our Lord, nineteen hundred and
eighty-seven.
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Since 19.07.98.