Foreign Performers - Subject to 30% Income Tax

January 21, 1993 BIR RULING NO. 046-93 FOREIGN PERFORMERS SUBJECT TO 30% INCOME TAX 22 (b) 99-98 046-93 Senate of the Republic of the Philippines Rm. 201 Finance Building Taft Avenue cor. Finance Street Attention: Atty . Lorenzo B . Leynes, Jr . This refers to your letter dated November 20, 1992 requesting a ruling on the following queries: cd "1. In the case of the Barry Manilow and Hammer concerts, are these foreign performers liable for any tax in the Philippines considering that their income were earned here? "2. Are the promoters in both concerts liable to pay income tax? If so, how do we assure that the income they will declare is accurate? "3. In the case of amusement tax, is it only the municipal or city where the concerts took place that could collect the tax? How about the national government, does it have any share from said tax? "4. That other form of taxes could the promoters and/or the performers be held liable?" In reply, please be informed as follows: 1. Foreign performers like Barry Manilow and Hammer whose stay in the Philippines did not exceed 180 days and who performed musical concerts in the Philippines for a fee are subject to income tax as non-resident aliens not engaged in trade or businesses at the rate of 30% on the entire income derived therefrom pursuant to Section 22(b) of the Tax Code, as amended by Executive Order No. 37. 2. For income tax purposes, the sponsors/promoters in both concerts shall be liable to income tax on whatever income or share they got from the proceeds of said concerts at the rates prescribed by Section 21(f) of the Tax Code as amended by Republic Act No. 7496. On the other hand, the income tax liabilities of said foreign performers will be collected from the sponsor/promoters of the show in the latter's capacity as agents. (BIR Ruling No. 025-83 dated February 18, 1983). Through investigation and documentary verification, their true income derived could be ascertained with some degree of accuracy. 3. Since musical concerts are not subject to internal revenue tax under Section 123 of the Tax Code, only the municipal or city governments where the concerts took place could collect the amusement tax in accordance with their taxing powers granted under (then Local Tax Code) now the Local Government Code. (BIR Ruling No. 99-89) 4. Since admission tickets to the musical show are required to be registered with the Bureau of Internal Revenue before being sold or disposed of pursuant to Section 17 of Revenue Regulations No. V-1 (BIR Ruling No. 465-88), the sponsors/promoters may be subject to the civil penalties under Section 274 of the Tax Code if the said requirements are not complied with. JOSE U. ONG Commissioner of Internal Revenue