SC settles gaming firms' tax woes.
A UNIT of integrated gaming resort developer Bloomberry Resorts Corp. has obtained a favorable ruling from the Supreme Court in its legal dispute with the Bureau of Internal Revenue (BIR) which had wanted to subject casinos to the regular 30 percent corporate income tax.
In a disclosure to the Philippine Stock Exchange on Tuesday, Bloomberry said the SC had granted the certiorari petition of its unit Bloomberry Resorts and Hotels Inc. (BRHI) against the imposition of corporate income tax on BRHI as a licensed casino operator of the Philippine Amusement and Gaming Corp. (Pagcor).
BRHI, the casino operator at Solaire Resort and Casino along Manila Bay, filed the petition in 2014 to nullify the provision of Revenue Memorandum Circular (RMC) No. 33-1013 issued in 2013 by then BIR Commissioner Kim Henares that imposed corporate income tax on casinos.
The BIR ruling created lot of jitters on the gaming industry as investors like Bloomberry had come in on the assumption of a competitive cost structure versus regional gaming hubs.
In a decision dated Aug. 10, the High Court affirmed Bloomberry's argument that as contracting party of Pagcor, it was subject only to the 5 percent franchise tax on its gross gaming revenue, in lieu of all taxes, as provided under Section 13(2) of the Pagcor Charter (Presidential Decree No. 1869).
'This Supreme Court decision will allow Pagcor and BRHI as an integrated casino resort to revert to the original license fee structure of 15 percent and 25 percent license fee (inclusive of the 5 percent franchise tax) for high rollers/junket and mass gaming respectively,' the disclosure said.
To neutralize the impact of the much-ballyhooed BIR ruling, Pagcor earlier came out with an interim solution of cutting gaming operators' license fees by 10-percent of gross gaming revenues. From the start, however, gaming operators were one in saying that such license fee adjustment was but a 'temporary measure' to address the unilateral BIR action and was not intended to modify, amend or revise the provisional licenses.
A petition for writ of certiorari is a document which a losing party files with the Supreme Court asking for a review of the decision of a lower court.
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|Publication:||Philippines Daily Inquirer (Makati City, Philippines)|
|Date:||Sep 6, 2016|
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