BIR Ruling

August 18, 1972 Mr. Rodolfo Baquero Midway Theater Kidapawan, North Cotabato S i r : This refers to your letter dated April 4, 1972 requesting in effect for an opinion as to whether or not a municipality can still impose an additional tax in excess of the 5% amusement tax limitation imposed on local governments under Section 260 of the Tax Code as amended by Republic Act No. 6100, in connection with Resolution No. 1 of the Barrio Council of Barrio Poblacion of Kidapawan imposing an additional tax of 2% centavos on every ticket sold to patrons by the different theaters of that municipality. In reply, I have the honor to inform you that as ruled by the Honorable, the Secretary of Finance, the 5% limitation imposed on local governments as provided for under the second paragraph of Section 260 of the Tax Code, as amended by Republic Act No. 6110, which reads as follows: "SEC. 260. Amusement taxes . . . . xxx xxx xxx "In the case of boxing exhibitions, there shall be collected from the proprietor, lessee, or operator an amusement tax at a rate equivalent to fifty per centum of the taxes prescribed in the preceding paragraph: Provided, That no local government shall impose any tax in excess of five per centum : Provided further , That all laws and ordinances in contravention hereto are repealed." applies specifically only to boxing exhibitions and not to other places of amusement. Accordingly, Resolution No. 1 of the Barrio Council of Barrio Poblacion, Kidapawan, Cotabato, imposing an additional 2% centavos for every admission ticket sold in all cinematographs in said Municipality is legal and not covered by the limitation imposed under the foregoing provision. Very truly yours, MISAEL P. VERA Commissioner of Internal Revenue