PCSO’s monthly tax collection to reach P1 billion

The monthly tax collections from lottery winnings are expected to reach P1 billion due to the Tax Reform for Acceleration and Inclusion (TRAIN) law, the Philippine Charity Sweepstakes Office (PCSO) said Monday.

“Sa buwan-buwan na ipinapatong sa [PCSO] na tax, nang kinumpyot namin dati-rati ang ibinibgay namin na tax mula sa lahat ng ating lottery games ay P500 million. Ngayon, aabot na ng P1 billion,” PCSO general manager Alexander Balutan said in an emailed statement.

Since the tax reform law took effect on Jan. 1, 2018, sales of PCSO increased by 2.81 percent to P5.384 billion in January to February 2018 from P5.337 billion a year earlier.

The TRAIN law reduced the personal income tax rates and expanded the value-added tax (VAT) base.

The law also mandates a 20-percent tax on all PCSO lottery game prizes exceeding P10,000, which could discourage the gaming public, Balutan noted.

“According to our lawmakers, that’s still a windfall. If you win P100 million and have to give back P20 million to the government, you'd still be happy with it,” he said.

For her part, Marivic Gaban of the Bureau of Internal Revenue (BIR) said Congress would have to file amendments to Republic Act 1169 or the Charter of the PCSO to exempt lottery winnings from the 20-percent tax.

Gaban met with officials of the PCSO on Friday to discuss the impact of the TRAIN law on lottery winnings.

It was signed into law by President Rodrigo Duterte on December 19, 2017.

Still, the PCSO—a government-owned and -controlled corporation—is optimistic about earning more revenues.

“This is the great thing happening now. The people are continuously patronizing PCSO's gaming products,” Balutan said.

“Of course, we are happy that the PCSO has increased earnings, which means we can help our people more, especially those that need medical services,” he said.

The PCSO is mandated to raise and provide funds for health programs, medical assistance and services, and charities of national character. —Jon Viktor Cabuenas/VDS, GMA News