Philippine President Rodrigo Duterte is urging lawmakers to pass a bill that would set a 5 percent gaming tax for the country’s online casino industry.
The bill, which Duterte described as “urgent,” would require all Philippine Offshore Gaming Operations (POGOs) to pay the tax on gross gaming revenue. It would also require foreigners employed by POGOs and their service providers to pay a 25 percent income tax.
Pia Cayetano, chairwoman of the Philippines Senate Ways and Means Committee, said the tax is essential to ensure that POGOs and their employees meet their tax obligations, whether they are located in the Philippines or elsewhere. The tax passed in the House of Representatives in February and is currently under consideration in the Senate.
But earlier this year, the Supreme Court suspended imposition of the tax, reports Inside Asian Gaming. The order followed opposition from online operators, who said increased costs and lower business volumes due to Covid-19 had decimated the industry
Cayetano emphasized that the tax will prevent POGOs from claiming they aren’t liable to pay taxes in the Philippines or that employees are exempt if they live outside the country.
“This bill now clarifies that all offshore gaming licensees, regardless of whether Philippine or foreign-based, are considered [to be] doing business in the Philippines and must pay 5 percent gaming tax on the gross gaming revenue or receipts derived from their gaming operations,” she said. “As clearly stated in the bill, 25 percent final withholding tax based on gross income will be imposed on an alien individual, regardless of residency in the Philippines, term, and type of visa.”
The 5 percent gaming tax will replace other taxes such as franchise taxes, levies and fees. The plan is expected to raise additional annual revenues of around PHP45 billion (US$935 million), IAG reported.
In related news, according to Asia Gaming Brief, the Philippine Amusement and Gaming Corp. (PAGCOR) said it turned over another PHP1.34 billion (US$28 million) to the government to help combat the pandemic, taking its contribution to PHP3 billion.
“After more than a year into the pandemic, PAGCOR is still doing its best to fulfill our mandate and commitment to nation-building. We may be in a very challenging time, but we are all in this together,” said Chairwoman and CEO Andrea Domingo. “Because of PAGCOR’s prudent use of funds and continuous effort to generate revenues, we are able to help fund necessary government programs amidst the crisis.”
Quarantine restrictions in Metro Manila and four adjacent provinces are likely to be relaxed in June, according to the presidential palace.
