Tax on PH offshore gaming firms to generate P144 billion in 5 years

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The chairman of the House Ways and Means Committee on Thursday said establishing a tax regime for Philippine Offshore Gaming Operators (POGOs) would help stabilize the industry, and generate as much as P144.54 billion for the government in the next five years.

Albay Rep. Joey Salceda made the statement as he lauded President Rodrigo Duterte for signing Republic Act No. 11590, which imposes a 5- percent tax on gross gaming revenues (GGR) of offshore gaming licensees and a 25 percent withholding tax on foreigners employed by POGOs.

“President Duterte was very clear: He will only allow gaming if they pay the right taxes. This will make sure they do,” Salceda said.

He said the measure will help the POGO industry recover since the country lost some of them to Cambodia due to the “uncertain” tax regime in the past.

“As long as they pay the right taxes and comply with all our laws, they will be able to operate,” Salceda said, highlighting that the POGOs would be operating under stricter terms.

He said after the SC TRO and the Covid-19 pandemic, the POGO industry shrunk by as much as 50 percent.

Salceda said he expects the sector to begin recovering with the passage of a clearer tax regime, as well as the property sector since POGOs are a key part of office occupancy in Metro Manila.

“The most important sentence here is that POGOs are considered ‘doing business in the Philippines’. They cannot escape our jurisdiction or the reach of our tax authorities. It is the single most consequential sentence in that law,” Salceda said.

Under RA 11590, around 60 percent of the total revenue collected from POGOS will be allocated for the Universal Health Care Act.

Around 20 percent of the revenue will be allotted for the health facilities’ enhancement programs, while the remaining 20 percent will be used for the attainment of Sustainable Development Goals by the National Economic and Development Authority.

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