BIR Ruling

June 22, 1970 Mr. Marcelo L. Tan Mari Bldg., Mac-Arthur Park Iloilo City S i r : This refers to your letter dated May 11, 1970 requesting information as to whether the different rates of amusement taxes on admission fees are based on admission price inclusive of the tax, as well as to the legality of the Tax Ordinance of Iloilo City approved on October 10, 1968 imposing an additional tax of 0.50 for every ticket sold as an amusement school fund tax aside from the regular amusement tax. In reply, I have the honor to inform you as follows: If the amount of the tax (including municipal or city tax, if imposed) are indicated on the face of the admission ticket, the basis of the tax is the price or amount paid for admission is P1.00 (excluding municipal tax of P0.05) and national tax of P0.20 indicated on the face of the ticket) the taxable amount paid for admission is P1.00, and the tax at the rate of 20% is P0.20. If the amount of the taxes (national, city or municipal) are not indicated on the face of the admission ticket, the price or amount paid for admission shall not be deemed to include the amount of such tax or taxes, and therefrom, such price or amount paid for the ticket, shall be the basis for the purpose of applying the corresponding rate at 20% or 30%, as the case may be. Thus, if the amount paid for admission ticket any amount corresponding to the amusement tax or taxes, the total amount of P1.20 shall be subject to tax at the rate of 30%, or P0.36, (Revenue Memorandum Circular No. 11-70, dated February 12, 1970). With regards to your query on the legality of the Tax Ordinance of Iloilo City, the same has been referred to the Honorable, the Secretary of Finance, considering that this matter falls within the jurisdiction of his Office. aisa dc Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue