Whether Donations from Private Individuals and Corporations to the Philippine Olympic Committee Fall within Sec. 20 of RA 6847

DOJ OPINION NO. 044 , s. 2005 September 1, 2005 Chairman William I. Ramirez Philippine Sports Commission Rizal Memorial Sports Complex Pablo Ocampo Sr. Street Malate, Manila Attention: Atty. Guillermo B. Iroy, Jr. Executive Director Sir : This refers to your request for opinion on whether donations made by private corporations, companies, associations and individuals to the Philippine Olympic Committee (POC) fall within the ambit of Section 20 of Republic Act No. 6847 1 otherwise known as "The Philippine Sports Commission Act." Said provision reads: "Section 20. Tax Deduction or Exemption of Donations and Contributions . All donations and contributions to the Commission in connection with its fund-raising projects and its continuing sports development programs shall be exempt from the donor's taxes, and shall be deductible in full in the computation of the taxable net income of the donor. Donations and contributions to the Philippine Olympic Committee and/or various national sports associations certified by the Commission to be pursuant to the development of sports shall likewise be exempt from the payment of donor's and estate taxes and shall be deductible in full in computing the taxable net income of the donor." As a backgrounder, you state that the First Gentleman Foundation (FGF) initiated the Gintong Medalya Program aimed primarily to subsidize the training requirements of national athletes preparing for the 2005 Southeast Asian (SEA) Games; that the Philippine Sports Commission (PSC), Philippine Olympic Committee (POC) and the FGF agreed that all donations or checks will be directed to the POC which will issue a corresponding receipt and the latter will, in turn, give it to the specified beneficiary. 06cdtai You would like to know if it is legally permissible for private sponsors to give the said checks or donations direct to the POC, a private entity, and whether a certificate of acceptance is required from the POC to effectuate a valid donation. Elementary is the rule that if a statute is clear, plain, and free from ambiguity, it must be given its literal meaning and applied without attempted interpretation. 2 When the law is unambiguous and unequivocal, application not interpretation thereof is imperative. 3 Section 20 is very clear when it speaks of two (2) instances when donations or contributions are exempt from donor's and/or estate taxes and deductible from the taxable net income of the donor. First, when the donations and contributions are given direct to the PSC in connection with its fund-raising projects and its continuing sports development programs. Second, when the donations and contributions are given to the POC or to the National Sports Associations (NSAs) which are certified by the PSC as pursuant to the development of sports. EDHTAI While this Department is not given a copy of the formal agreement, if any, between and among the FGF, PSC and POC, we take it that the situation presented in your query squarely falls under the second instance above-mentioned. Since the donations and contributions are given direct to the POC which issues a corresponding receipt therefor and which, to our mind, is tantamount to acceptance of the donation and sufficient compliance with the requirements of the law, the provision of Section 20 on tax exemption from donor's and estate taxes will apply if the PSC will certify that such donations and contributions are pursuant to the development of sports. Please be guided accordingly. Very truly yours, (SGD.) RAUL M. GONZALEZ Secretary Footnotes 1. The long title reads: AN ACT CREATING AND ESTABLISHING THE PHILIPPINE SPORTS COMMISSION, DEFINING ITS POWERS, FUNCTIONS AND RESPONSIBILITIES, APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES. 2. Del Mar v. PAGCOR , 358 SCRA 768 [2001]. 3. De Guzman Jr. v. Sison , 355 SCRA 69 [2001].