Amendment to the Regulatory Manual - 04.18.2018 (Latest)

AMENDMENTS TO THE REGULATORY MANUALS

and the corresponding amendments to the Gaming Site Regulatory Manuals (GSRM) version 3.0 for Bingo Games: Application of 5% Franchise Tax on income, exclusion from Payouts of the final tax on Player's jackpot winnings exceeding Ten Thousand Pesos (PhP10,000.00)

A. Electronic Bingo (eBingo) Games

1. Reversion to pre-RMC 33-2013 set-up, where the 5% Franchise Tax is applied to the Gross Gaming Revenues (GGR) prior to sharing by and and the Bingo Operator share 50%-50% on the GGR after deducting the 5% between PAGCOR and the Bingo Operator. In effect, both PAGCOR and the Bingo Operator shall pay the 5% Franchise Tax. Conseguently, PAGCOR franchise tax.

2. Amendment of Regulation 22 Section 1 (b) of the Gaming Site Regulatory Manual for Bingo Games version 3.0 as amended to (i) exclude the Prize Tax in the determination of Total Payouts, and (ii) to include the 5% franchise tax deduction in the formula, as follows:

HhECWU FROM HoOoNOaw Section 1. Computation of PAGCOR Share (b) Electronic Bingo (eBingo) Games: XXX

Less: Total Payout Gross Collection (inclusive of taxes on Jackpot Prizes of above PhP10,000.00) XXX XXX GROSS GAMING REVENUE (GGR) XXX PAGCOR Share (PS)* 50.00% of GGR

2

*PAGCOR Share is for remittance to PAGCOR

TO Section 1. Computation of PAGCOR Share

(b) Electronic Bingo (eBingo) Games: XXX

Less: Total Payout Gross Collection (excluding taxes on Jackpot Prizes of above PhP10,000.00) XX XXX Gross Gaming Revenue (GGR) Less: Franchise Tax (5% of GGR) XX XXX

GROSS GAMING REVENUE AFTER FRANCHISE TAX XXX

PAGCOR Share (PS)* * PAGCOR Share and Franchise Tax are for remittance to PAGCOR =50.00% of GGR after Franchise Tax

B. Traditional Bingo Games, Rapid Bingo, Gaming Arts and Pull Tab Bingo

1. For Traditional Bingo, reversion to pre-RMC 33-2013 set-up, where the 5% Franchise Tax is applied to the Gross Gaming Revenues (GGR). PAGCOR's shouldered by the Operator. 15% share in Gross Ticket Sales is preserved and the franchise tax amount is

2. In the case of Rapid Bingo, Gaming Arts and Pull Tab Bingo, reversion to pre- RMC 33-2013 set-up, where the 5% Franchise Tax is applied to the Gross scheme such that PAGCOR's 15% share in Gross Sales is preserved and the franchise tax amount is shouldered by the Operator, similar to Traditional Bingo. Gaming Revenues (GGR) with a modification in the revenue sharing

3. Amendment of Regulation 22 Section 1 (a) of the Gaming Site Regulatory Manual for Bingo Games version 3.0 as amended to (i) exclude the Prize Tax in the determination of Total Payouts, and (ii) include the remittance of the 5% franchise tax, as follows:

Section 1. Computation of PAGCOR Share (a) Traditional Bingo Games including Instant Games and Bingo game variants: FROM XXX wpiwwwcnwwaeu.sanwog

Gross Sales (GS) XXX PAGCOR Share (PS)* 15.00% of GS

*PAGCOR Share is for remittance to PAGCOR

L 0 TO

Section 1. Computation of PAGCOR Share

(a) Traditional Bingo Games including Instant Games and Bingo game variants such as but not limited to Rapid Bingo, Gaming Arts and Pull Tab Bingo: XXX

Gross Sales (GS) XX PAGCOR Share (PS) 15.00% of GS

Gross Sales Less: Total Payout (excluding taxes on Jackpot Prizes of above PhP10,000.00) XXX XXX

Franchise Tax** Gross Gaming Revenue (GGR) =5.00% of GGR XXX

** Franchise Tax is for remittance to PAGCOR * PAGCOR Share is for remittance to PAGCOR

on the first (1st) quarter of 2018 i.e. beginning January 1, 2018. Implementation of the 5% Franchise Tax on Bingo game offerings shall take effect

C. Final Tax on Player's Jackpot Winnings from Bingo Games exceeding Ten Thousand Pesos (PhP10,000.00)

1. Amendment of Regulation 8 Section 10 (c) of the Gaming Site Regulatory Manual for Bingo Games version 3.0 as amended to include the Operator's option to shoulder the final tax on player's jackpot winnings, as follows:

FROM Section 10. Final Tax on player's jackpot winnings from bingo games

XXX (c) The Operator shall report to CMED all taxes withheld on players jackpot winnings and proof of payment thereof within fifteen (15) days from payment or deadline of payment, whichever comes first.

Section 10. Final Tax on player's jackpot winnings from bingo games

XXX (c) The Operator shall withhold the final tax on player's jackpot winnings from Bingo games exceeding Ten Thousand Pesos (PhP10,000.00).

(d) The Operator has the option to shoulder the final tax on player's jackpot winnings stated in subsection (a) above, although remittance should still be in accordance with existing revenue regulations.

(e) The Operator shall remit the final taxes withheld on players' winnings in accordance with existing revenue regulations. The Operator shall report to CMED all taxes withheld on players' jackpot winnings and proof of payment thereof within fifteen (15) days from payment or deadline of payment, whichever comes first.

2 Amendment of Regulation 18-B Part I Section 7 (a)-5 of the Gaming Site

thousand pesos (PhP10,000.00), as follows: Regulatory Manual for Bingo Games version 3.0 as amended to include the revised guidelines on payment of the final tax for prizes of more than ten

A FROM R Section 7. Prizes (a) Guidelines for prizes

XXX 5. Any single prize of more than Ten Thousand Pesos (PhP10,000.00) when awarded to a winner is tax-paid. In effect, all prizes are net of the applicable taxes. Total gross amount of the prize as computed includes the applicable taxes. Operator, as the withholding agent shall file the appropriate tax return and remit the total prize taxes for the period covered.

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6. The aggregate value of all prize payouts awarded to winners and those special game(s) or as bonus prize in any regular or special game to be awarded within the year; otherwise, the amount shall be forfeited in favor of PAGCOR to be utilized as source of funds for responsible payout, if any, as of the end of the month, using the Monthly Sales Report for Traditional Bingo. forfeited, and the applicable tax imposed on these prizes must be at least thirty percent (30%) of the total gross receipts from sale of bingo cards/tickets for the month. If the average actual payout percentage form a common prize fund to be given later as additional prizes for gaming programs. For this purpose, the Operator shall account for all prize payouts to determine the required amount to maintain the 30% falls below the required, the difference in amount shall be set aside to XXX

0

Section 7. Prizes

(a Guidelines for prizes

XXX

5 Final tax for any single prize of more than Ten Thousand Pesos total prize taxes for the period covered. withholding agent, shall file the appropriate tax return and remit the (PhP10,000.00) shall be shouldered by the Player. However, the Operator may opt to shoulder said final tax. In effect, all prizes exclude the applicable taxes. Total gross amount of the prizes as computed excludes the applicable taxes.The Operator, as the

6. The aggregate value of all prize payouts awarded to winners and those Monthly Sales Report for Traditional Bingo. bingo cards/tickets for the' month. If the average actual payout responsible gaming programs. For this purpose, the Operator shall account for all prize payouts to determine the required amount to maintain the 30% payout, if any, as of the end of the month, using the forfeited excluding the applicable tax imposed on these prizes must be at least thirty percent (30%) of the total gross receipts from sale of percentage falls below the reguired, the difference in amount shall be set aside to form a common prize fund to be given later as additional prizes for special game(s) or as bonus prize in any regular or special game to be awarded within the year; otherwise, the amount shall be forfeited in favor of PAGCOR to be utilized as source of funds for

XXX

3. Amendment of Regulation 18-C Section 2 (b) of the Gaming Site Regulatory Manual for Bingo Games version 3.0 as amended to delete the non-deduction of the final tax from the prize due to the winner, as follows:

E FROM Section 2. Prizes

XXX

b winner. For recording purposes, computation of the total payout to submit to CMED proof of remittance of the same to the BIR on the All prizes over ten thousand pesos (PhP10,000.00) shall be subject to withhold and subsequently remit to the BIR. However, the 20% withholding tax shall not be deducted from the prize due to the for each winner of jackpot prize over PhP10,000.00 shall include period prescribed. the twenty percent (20%) withholding tax which the Operator will the 20% prize tax imposed on this prize. Operator shall be required XXX

TO OM H Section 2. Prizes

XXX

(b All prizes over ten thousand pesos (PhP10,000.00) shall be subject to the twenty percent (20%) withholding tax which the Operator wil withhold and subsequently remit to the BIR. The Operator shall be required to submit to CMED proof of remittance of the same to the BIR on the period prescribed

XXX

A Amendment of Regulation 21 Section 3 last paragraph of the Gaming Site

Regulatory Manual for Bingo Games version 3.0 as amended to redefine Payouts (PO), as follows:

FROM BOENUV

Section 3. Definition of Gross Gaming Revenue

Gross Gaming Revenue (GGR) is equal to Gross Collection Iess Payouts (PO), where XXX

redeemed electronic bingo receipts or vouchers plus the twenty percent (20%) prize tax for all jackpot prizes above ten thousand pesos (PhP10,000.00). P0 shall be net of all unredeemed electronic bingo receipts or vouchers. Po shall be the total amount paid out by the Cashier for

XXX

TO T53999420

Section 3. Definition of Gross Gaming Revenue

Gross Gaming Revenue (GGR) is equal to Gross Collection Iess Payouts (PO), where XXX

redeemed electronic bingo receipts or vouchers excluding the twenty percent (20%) prize tax for all jackpot prizes above ten unredeemed electronic bingo receipts or vouchers. Po shall be the total amount paid out by the Cashier for thousand pesos (PhP10,000.00). P0 shall be net of all

XXX

5. Amendment of Regulation 21 Section 4 (c) of the Gaming Site Regulatory Manual for Bingo Games version 3.0 as amended to revise the guidelines on accounting of payouts, as follows:

T9W FROM Y Hncays

Section 4. Determination of Gross Gaming Revenue from electronic bingo games XXX

( Payouts shall be accounted (taking into consideration the bingo receipts or vouchers that remained unredeemed after the closing total paid payouts for the day. applicable tax on jackpot prizes thereon) less whatever electronic of the previous trading day's operation, i.e. forfeited, to arrive at the

XXX

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Section 4. Determination of Gross Gaming Revenue from electronic bingo games XXX

(c) Payouts shall be accounted (excluding the applicable twenty arrive at the total paid payouts for the day. percent [20%] prize tax on jackpot prizes thereon) less whatever electronic bingo receipts or vouchers that remained unredeemed after the closing of the previous trading day's operation, i.e. forfeited, to XXX

Bingo Games exceeding Ten Thousand Pesos (PhP10,000.00) shall take effect on the date of publication of these amendments to the GSRM at the PAGCOR Implementation of the revised guidelines in the Gaming Site Regulatory Manual for Bingo Games version 3.0 as regards the final tax on player's jackpot winnings from Regulatory website.