The Philippines Representative Joey Salceda filled a new bill in the House of Representatives proposing a new 5% tax on the revenue generated by the Philippines Offshore Gaming Operators (POGOs) and their service providers register as resident corporations.
The bill also sets out a $10,000 monthly tax on table games, and a $5,000 monthly fee levied on random number generator (RNG) based games such as slot machines. It would also set out a $1,000 presumptive tax on income, rather than an assessment based on actual earnings.
Currently, the POGOs pay a $100 levy on RNG games, and $40,000 a month for sports betting activities.
The bill received support from PAGCOR and the Department of Finance, with Finance Secretary Carlos Dominguez stating, “I haven’t seen the exact proposal, but in general, yes. I think that’s a good idea.” “However”, he added, “operators were already paying a 5% franchise tax on revenue”.
Salcedo’s bill is currently being scrutinized by the House Ways and Means Committee, which he chairs.
The Philippines Bureau of Internal Revenue (BIR) has collected PHP1.63bn (£24.9m/€28.7m/$31.9m) in taxes from POGOs between January and August 2019, a significant increase from previous years. In 2017 these businesses paid just PHP175m, and PHP579m in 2018.
Official figures show that there are 218 POGOs registered with the BIR, employing 108,914 foreign workers, the Philippines authorities have stepped up efforts to ensure all are paying taxes this year.
The Great Empire Gaming and Amusement Corporation (GEGAC) was closed for failing to pay its taxes. The company was forced to pay an installment of PHP250m before agreeing to settle for the outstanding sum of PHP1.05bn to be paid in 3o days to able to resume operations.
On October 17, the BIR closed two offices owned by Altech Innovations Business Outsourcing after the company failed to register as a value-added tax (VAT) payer, in violation of the country’s National Internal Revenue Code.
Despite pressure from China, the Philippines refuses to ban online gaming, citing the economic benefits it brings to the country.
