National Capital Region (NCR) Head Revenue Executive Assistant Marivic Acosta-Galban, cautiously defined the 20 percent tax in all lotto winnings, starting January 2018, under the Tax Reform for Acceleration and Inclusion (TRAIN) Law of the Bureau of Internal Revenue (BIR), before the PCSO top management and the Accounting and Budget Department focal persons at the 9th floor of Sun Plaza Building, Shaw Boulevard in Mandaluyong City on March 9.
Under the Philippine Charity Sweepstakes Office’s (PCSO’s) charter and the existing National Internal Revenue Code (NIRC), PCSO lotto prizes are tax-exempt, “However, your tax-free winnings is gone, the PCSO charter has now been changed by the TRAIN law,” Galban said.
The TRAIN law is the first package of the Comprehensive Tax Reform Program (CTRP) conceived by the Duterte administration, which aims to correct a number of deficiencies in the tax system and simplify its scheme.
On December 19, 2017, Pres. Rodrigo Roa Duterte signed Republic Act RA 10963 or Tax Reform for Acceleration and Inclusion or the TRAIN law which provides the increase in take-home pay of salaried Filipino by reducing income tax rates, while increasing and rationalizing tax rates in other goods and services, one of which is PCSO’s lotto prizes.
Whereas all winnings were tax-free before, starting January 2018, all PCSO lotto prizes are taxed 20 percent if the amount of the prize or winnings is above P10,000.
PCSO General Manager Alexander Balutan gladly appreciated the presentation of Galban, to make the new tax system in the charity agency easier to understand, and strongly assured BIR, that PCSO will strictly observe what the TRAIN Law dictates. He also stated that PCSO will echo to its clients about the “Tax-Free No More” in lotto winnings.
A Certificate of Appreciation was given to Galban after the TRAIN Law Forum to acknowledge the BIR’s objective in making the TRAIN Law understandable to PCSO and its clients.