Tax on winnings.
Section 260-A
SEC. 260-A. Tax on winnings.—Every person who winy in horse races or jai-alai shall pay a tax equivalent to five per cent of his winnings or 'dividends' the tax to be based on the actual amount paid to him for every winning ticket after deducting the cost of the ticket. The tax herein prescribed shall be deducted from the "dividends" corresponding to each winning ticket and withheld by the operator, manager, or person in charge of the horse races or jai-alai before paying the 'dividends' to the person entitled thereto. The same tax shall be collected from owners of winning race horses at the same time and in the same manner above. "The operator, manager, or person in charge of horse races or jai-alai shall, within twenty days from the date the tax was deducted and withheld in accordance with the first paragraph hereof, file a true and correct return with the Commissioner of Internal Revenue in the manner or form to be prescribed by the Secretary of Finance, and pay within the same period the total amount of tax so deducted and withheld. "If the tax herein provided is not paid within the time prescribed above, or in case of willful neglect to file the return within the period prescribed herein, or in case a false or fraudulent return is willfully made, there shall be added to the tax or to the deficiency tax, in case any payment has been made on the basis of the return before the discovery of the falsity or fraud, the corresponding surcharges provided in Section two hundred and sixty of this Code."