PCSO mulls 20 percent tax on lottery winnings

Manila, Philippines - This could be bad news for lotto bettors.

The Philippine Charity Sweepstakes Office (PCSO) is looking into the possibility of imposing a 20 percent withholding tax on the jackpot prizes of lottery games, particularly the 6/55 grand lotto jackpot, which is now almost P300 million.

Margarita Juico, chairperson of the PCSO said she would ask the PCSO legal division to coordinate with the Bureau of Internal Revenue (BIR) to come up with the mechanics on the proposed withholding tax.

“My proposal may not be popular. But lotto winnings are also additional income and I see no reason why the government must not impose the corresponding tax,” she said.

Juico cited the case of a balikbayan who paid over P200 million tax to the US government out of the P741 million jackpot he won in the grand lotto draw last November. The winner, a US citizen, converted part of the pot into dollars and remitted it to the US Internal Revenue Service (IRS) as payment for the tax on his winnings.

Lotto winnings in the Philippines, however, are tax-free.

The PCSO chief meanwhile expressed hope that several bettors will hit the winning combination of the grand lotto if it did reach P300 million. A sole winner of the jackpot prize may not able to cope up with instant fortune, she added.

Jose Ferdinand Rojas II, general manager of the PCSO said the jackpot prize in the grand lotto draw tonight is expected to reach 280 million or more depending on the sales of tickets.

Ticket sales spiked from an average of P25 million per draw to P80 million during last Wednesday’s draw.

“The rapid increase of sale is an indication that a lotto frenzy is now building up across the country,” Rojas said.