PCF eyes zero tax

The Philippine Chess Federation, in an effort to end the controversy that marred the recent Chess Pambansa Millennium Grand Prix, is seeking a formal clarification and official ruling from the Bureau of Internal Revenue regarding the tax scheme the PCF imposed on the players' winnings.

PCF chair Arturo Borjal said he will personally talk with BIR chief Dakila Fonacier to get an official ruling on the matter to, once and for all, settle the issue that drew an uproar from the players, particularly GM Rogelio Antonio, Jr. who won the top P1 million purse.

"In the light of the continuing controversy on whether the prizes of the players in the Chess Pambansa Millennium Grand Prix must be subjected to withholding tax or not, I am requesting the BIR for a formal clarification and ruling on this matter," said Borjal.

The BIR last week actually furnished the PCF a copy of the revenue regulations, stating that winnings derived from sources within the Philippines are subjected to a 20 percent withholding final tax.

But tax experts said pertinent provisions of the law could be subject to different interpretations.

Philippine Sports Commission official Leonardo Celles said chess players should be treated like national athletes whose incentives are not subject to tax.

"If a national athlete gets P200,000 from the President for winning in an international competition, this is not subject to tax, so why tax Antonio, who is also a national athlete," said Celles. "Issues should be resolved in favor of the athlete."

According to some tax experts, there is a provision in the revenue law that exempts athletes from the tax scheme, that, once cleared and clarified, would pave the way for Antonio and company to receive their prizes in full.

"Should the ruling be positive, that is to exempt the players from the tax, then we shall take it to mean that the PCF is freed of its obligation to act as the BIR withholding agent and that we are now allowed to release the entire amount to the players," stressed Borjal.

In a recent talk with PCF president Reynato Sarmiento, Borjal said they agreed to look into all means possible to award the prizes to the players in full.

"In case it can be proved that there is a specific law or precedent that athletes are indeed exempted from the tax scheme, then we are ready to take the needed action in favor of the players," added Borjal. -