Request of Exemption from All Taxes the Prize Money of Boxing Participants in the IBP Championship Title Bout

September 3, 1987 BIR RULING NO. 262-87 21 (c) 22 (b), 51, 53, 228 032-87 262-87 Gentlemen : This refers to your letter dated July 27, 1987 addressed to Her Excellency President Corazon C. Aquino which was referred to this Office by the Acting Chief, Finance Revenue Service, Department of Finance, relative to your request for exemption from all taxes, including income tax, of the Champion's prize money, that of the Challenger and all other boxing participants to the International Boxing Federation (IBF) World Championship Title Bout to be held in Manila on September 5, 1987 between Philippine Champion Dodie Pealosa and Korea's Chang Ho Choi. In reply, I regret to inform you that your request cannot be granted by this Office for lack of legal basis. Pursuant to Executive Order No. 225 which amended Section 228 of the Tax Code, you are exempt only from the 10% amusement tax imposed by said section of the Tax Code as promoter of the boxing bout wherein one of the contenders and concurrently champion is a Filipino citizen. Said Executive Order does not include the exemption from income tax of the money prizes of the boxing participants therein. Accordingly, the money prizes exceeding P3,000.00 to be derived by Filipino participants in said boxing promotion shall be subject to a final tax of 20% pursuant to Section 21(d)(l) of the Tax Code, as amended, while money prizes amounting to P3,000 or less shall be subject to tax under Section 21(a) of the same Code. On the other hand, the money prizes of the Challenger, who is Korean, shall be subject to a tax of 30% on the total amount thereof under Section 22(b) of the Tax Code. Moreover, as the promoter having the receipt, control, custody, disposal and payment of the money prizes you are liable to withhold the aforesaid 20% and 30% final taxes before paying such money prizes to the persons entitled thereto pursuant to said Sections 21(c)(1) and 22(b) in relation to Sections 51(a) and 53, all of the Tax Code as amended by Executive Order No. 37. Very truly yours, (SGD.) EUFRACIO D. SANTOS Deputy Commissioner Officer-In-Charge