CTA Case No. 205 (Decision)

l'l~PU H. � II 11'1 IN COUHf l- ,\Pl'EALS MAJ\IlLA .. v raua - ��� � 205 r -ent. I l ...... ,~ -�J( 6 ------ Tb1s is eal filed by petitioner fr th d cision of s asing a inst t form r e ount of 39 , 10. d 1 , 173. as ---�--�--e.n..t..tax o the 5 of th total b ta which was set aside f r prize� to t e ers of winning orses and authorized bonuses for jockeys and on th 1/ p rticipati of the oard on Races (now kn .n as the nts ard - ) rin the eriod fro ov er , 19 to cto er, 1947, ov b r 1 , 1947 to cto er 31, 19 � r eetive!y , inclusive of aurcharges. The facta in t is cas are sl le. P titioner nila J ckey Club, Inc., ia a co or tl ly or n ze un r t � laws of t e i l pines. It ia the successor to an old 1nco orated associa- tion known a the 11 ni l c ey Club , and is ng ged in t � sines of holdin horsl racea in anile. Bett ing in ora races is all e by law t rou h t � sale of ticket to t e public by t e racing club. The total ount of oney ch the 18 ,_t I c.

.... 2 - w� p bl1c b t n a ~aee i c ll total er f nda. ing t e p�riod d ~ � the �total ager n r celv d f~ t � le f ti~kets ~ dlstrib ted oll � t.r1 l/2 - e d dtstri t d g rs of winning ticketsJ 12 l / ... t a � did ot incl d In it r urn of t u art f 1 �g s th o 1 n th "total und&" et ide fo p z o wi ning orse (5, n fr l lund f t nt s d p titlon r efi i ncy u id xclud ort on . of ro thi ssess- nt, iti r fil p 1. Th i e A. v lv n arized ' 0 l th �g 0 I" c ipt � f (l) titi n r subj e � t he nt tax pr scrl din 2 of t ra � , inclu th 1/ t s1d ei 1 nd 8 nt o rd an e 6 � or ria: of ,. 1_ 85

- � 205 - 3- ne a of nning horae� and authorlz d nueea for joc~eya; d (2) ng t at th entire 12 1/ of th �total w 9 r fu ds� 1s sub eet to the �� &nt tax , (a) eth r or not p titi n r 1& 11 l fo the pay- nt o t e all� itiency u � n tax conai- derin th eqUitable d f s t1 tit fil d its r turns pu au nt to t i n o of ct f s ic ( in n � 34 � a. 19 l.): � n t de ic c;y t ta t of 39,5 3. b -. c ib d? � d t rorn t p ion � ef c ency �� nt in t ,1 � � already np d. �� pet t1onez d t ross zece pts� w. i ch a subje t 0 G t f rs on t a r c pts 1eh 1 c fr ly cl din th a nts � ts � out lly d X' l t ce t f nd nt ownera an jock y fth or � ot ' ent clai s t r c- t1 � 3 ' 1 of 1941, lie la is � ini � e tt1 a all d atr llow s (1 ) 7 l l t� (2} 12 1/ co.- on , r e-tr c � r in clu , any o :r 1 ng rse cin � n o:rt, 186 - ~------- --~---

"total a f nds � It could legoll disbu%8 for it own pu os s only th aid 7; end ot th total 12 11 of t tot 1 we er f � d -. th l:e rd t o as rcl eld in tru by pettt1 n r, nd 1 t � le l n r& - th G G nd d the ers end I ence, it ia � aisn r to t� on� of p titi er f r n~l de th amo ts f ~ p 1z of u o- ri d bonuc s f j nd t � l/2 p 1eip tion of � ard over ich p ti- ti r erein & i cr ti r:. a att r of' ight baa on c es p ovl ion f 1 ts nd j keys f winn � 0 nd th d se- nt& oard c ro p t t.ion r fo.. - ir r p c 1v r in t 12 1/2% of ~l tot l ger fun s~. e. , �x c , - ries 0 941; ct e 9, � � "" � ) C xt inly � t � � 1'06& :cec ipt s� w. c. ubj et to t U$ talC under Section 2 f t T X Code 0 l d ot 1 c .o ta 1 9 ll d/01' set 1d s nts dt � rs and jock y t nt .- l� o he is t ould :i � g t e t t X n 2: c ipts upon t l.C w n v c i vod. 1 88

-6- or over, t h t � rots r ec t � o usod in Section 2 t e T x te d i h .t 9 d t o receipts btain d fro h l ding t10 r aces has al� re dy been g von a consist t nd sound ed i nia ro- tive interpz t t1on � to oxcl o n s et s1de or allot t e amao d u � t o r d and ers end jockey of 'in n hor (Opi - nton � 34~, ries of 1941; in1o o. 249 , S ries f 1952; nd qp nion o. er es o 1955, all t i e c:t t a.ry c J uat1c ). Th . n- terpretatlen giv by t ec ~ct r of vstic o C $G t bar, e find no v l i d nd strong ea son to d xt � ( ov't of . I . v. ni c p lit~ of Binal n�n , 2 hil . 634; l olin v. rty. 37 P il. 545; Yra v. ' 5? hi � 3 �� i l � u 8%' Centrals g ncy v. Col l ct r of cu t om , 1 hil. 131. ) It ou d e not d th t that may still b entert i ne after t r nd t the three opinions o t ~ee ecre ar1 a o Justice, a to t e eening of th p '* btal.n in conducting hora reces, has d f i nitely clari- fi d nd aettlGd :1th t e en ct nt o epu lie Act Jo. 1933 by the 1 t Co r �� on June 22 , 1957. Con- gresl , in ~he di stribution of the �total wa r un s � or gross r ceipts fro t.e s 1 f tickets. ha clearly � erated fro t. co 1as1on of t p o , 189 lt3

- -- t � 2CO -7- racetr ck . cing c:;l , or any ot, tity ccn- ductin t, c� porti n oul $t d i s ... � era d n tn , tri ut on o r c pt ll be a o lo as 87-1/ , - d 6-V ic h p rson, ~-1/2. - 'r ng club , or ntity c n u ti l/ - 8!), - -1/? 6 for J.nnin nd 1/2 - ~ ci 1 fund of th nd sements 8 ar � aving rrived t t is c . eluei ad to t firet 1 , it bee s necessary for Court to pats on t e a ec n i u � t v en � �t of Intern 1 dee! 1 of r ~pond nt Co v ue . should be, s it is ed , itbo t 190 / () .

\ - 8- p%onoune nt ,, to coat s. anil � ril 15 , l95e. Associ t J udg ~~ 1 9 1 /I