y Alexander Villafania
QUEZON CITY, METRO MANILA – If they had it their way, Representatives Rufus Rodriguez (2nd district, Cagayan De Oro City) and Maximo Rodriquez, Jr. (Abante Mindanao) would claim taxes from lotto winners.
The two lawmakers point out that winners have to be taxed primarily because a law requires it, citing Republic Act 8424 or the Tax Reform Act of 1997.
They cited in particular Section 32, which highlights the “taxable gross income from other sources not related to fees, salaries, wages, commission, and similar items”.
While Section 32 does not define lottery prizes as among those that can be taxed, a different part of RA 8424, Section 25, addresses that lottery prizes remain non-taxable.
The lawmakers also aim for the amendment of the law's Section 25 through their proposed House Bill 4832, which imposes a final 20 percent tax on all lottery winnings. Similarly, the bill would also impose a 10 percent tax on royalties, not including literary works and musical compositions.
The two lawmakers insist that taxes can be imposed on large jackpot prizes. The taxes could be revenues for the government. They cited one winner, a balikbayan who won the country's biggest lottery prize of P741 million in December last year, paid the US government at least P220 million in taxes.
The still-unidentified balikbayan is said to be a 60-year old Filipino worker who became an American citizen.
The US government requires all American citizens to pay taxes on revenues that are generated even outside the US. This also includes lottery winnings.
