by: Mickey Ingles (Photo credit: MPBL Youtube Page)
The do-it-all Senator is back at it again. Just a couple of months after trading his legislative hat for boxing gloves, Senator Manny Pacquiao is entering yet another endeavor: a new basketball league. Yes, the boxing champ is putting up his own basketball league called the Maharlika Pilipinas Basketball League (MPBL).
The MPBL follows the format of the now-defunct, forever-fun Metropolitan Basketball League with a home-and-away format. It does have a twist: aside from the 12 teams from different local government units (LGU) like provinces and cities in Luzon, there will also be inter-barangay action which can be watched online. If you ever dreamed of watching Barangay Ugong battle Barangay Loyola Heights on your work computer while your boss isn’t watching you like a hawk, then the MPBL is just for you.
Seriously though, the MPBL seems promising, especially since it aims to give local basketball cagers a chance to shine and earn a living (salaries can range from P40,000 to P150,000/player for six months). It’ll also serve as a good springboard for local hoopers—each LGU team must have at least 4 residents. Who wouldn’t love some hometown crowds cheering their neighbors on?
When I first read about it, the first thing that came to mind was, “hmm, how’ll this be taxed?” (No judgments please. I’ve got a weird brain.)
If the MPBL is considered a professional league, then it’ll be liable for percentage taxes under the National Internal Revenue Code. Specifically, 15% of MPBL’s gross receipts (which includes income from gate receipts and TV rights).
Will the LGUs get a cut from the MPBL’s profits, especially since it’s going to be in a home-and-away format?
Unfortunately for the LGUs, no. The law, as it stands, excludes LGUs from imposing amusement taxes on professional basketball games. In Philippine Basketball Association v. CA (August 8, 2000), the Supreme Court ruled that the PBA is liable to pay amusement taxes under the NIRC and not to the local governments. In deciding this way, the Court traced the tax treatment of professional basketball games all the way back to 1976, when Presidential Decree 871 was passed, placing professional basketball games under the scope of the Games and Amusements Board. It found that for years, professional basketball games are taxed nationally, to the exclusion of LGUs.
But again, this is the rule for professional basketball leagues.
If the MPBL is considered an amateur league (which seems a bit of a stretch, given the salaries of the players), the LGU may be able to dip its fingers in the MPBL’s purse. LGUs may argue that PBA v. CA only applies to professional basketball games and invoke its taxing power under the Local Government Code. Provinces and cities may impose amusement taxes on amusement places to tune of up to 30% of gross receipts from admission fees. Pelizloy Realty Corporation v. the Province of Benguet (April 10, 2013) has interpreted “amusement places” as “venues primarily for the staging of spectacles or the holding of public shows, exhibitions, performances, and other events meant to be viewed by an audience.” And what’s a better spectacle than seeing the dude who used to beat you silly in iced tubig games trading his Air Tsinelas for some Air Jordans?
Of course, the big question is: will Pacman suit up and bring his trademark jumper to the MPBL?
The MPBL is set to tip off on September 23, 2017.
Mickey Ingles is the editor-in-chief of Batas Sportiva. He practices tax law, but would rather be practicing his free throws.
 Sec. 125, NIRC.
 Which leads me to ask… how are professional soccer and volleyball games taxed? Because Section 125, NIRC explicitly states “basketball games,” so that won’t apply to other sports.
 Section 140, LGC.