The Supreme Court of the Philippines has issued a temporary restraining order to stop a 5 percent franchise tax from being imposed on Philippine Offshore Gaming Operators (POGOs). The action was taken to stop the exodus of POGOs from the country, according to Joey Bondoc, head of research at Colliers Philippines.
Inside Asian Gaming reports that the POGO industry is in decline due to Covid-19 and the implementation of a new tax. The tax in question, signed into law by Philippines President Rodrigo Duterte last September, reportedly could double government revenues from the industry by subjecting all “offshore gaming licensees, including gaming operators, gaming agents, service providers and gaming support providers” to a tax on turnover rather than revenue.
The tax was blamed in part for the shutdown of more POGO operations, which are concentrated in Metro Manila.
In an interview with Market Edge, Bondoc said at least 150,000 square meters (1.6 million square feet) of office space was vacated by POGOs in 2020. He said POGOs have “enjoyed and benefitted from the integrated lifestyle in Metro Manila, particularly in the Bay Area where their office buildings are near their residences, near retail, restaurants,” but the 5 percent tax has been a damper on business.
It is not yet known whether the TRO, voted for 13-1 by Supreme Court judges, will become permanent.
