KEY MESSAGES
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Philippine Offshore Gaming Operations (POGOs) is a relatively new online gambling activity and an emerging industry in the country. |
As of December 2019, there are 61 POGOs under the supervision of the Philippine Amusement and Gaming Corporation (PAGCOR) – 84% of which are in the National Capital Region particularly Makati City (27), Pasay (12) and Manila (5). Ten of total POGOs are local-based while a larger number (51) are considered foreign-based. |
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On the other hand, providers of allied services such as Customer Relations Service, Strategic Support, Live Studio and Streaming, Gaming Software Platform Provider, and Business Process Outsourcing numbered 233 as of December 2019. |
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Total employment among PAGCOR licensees as of December 2019 was 118,239 personnel. Of the total employment, 82.3% are foreign nationals and 17.7% are Filipinos. |
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PAGCOR collection from regulatory fees and other related charges for the period September 2016 to December 2019 amounted to almost P19 billion. Meanwhile, 2018 to 2019 collections by the Bureau of Internal Revenue (BIR) from franchise tax, corporate tax, VAT and other taxes amounted to P3.2 billion while withholding taxes on compensation and final withholding tax amounted to P5.6 billion – or a total of P8.8 billion. |
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However, the BIR estimates that unremitted withholding tax on compensation and unremitted franchise tax from POGOs and Service Providers in 2018-2019 amounts to P39.7 billion and P43.9 billion, respectively or a total of P 83.6 billion. |
| House Bill No. 5777 seeks to address the taxability of POGOs through amendments in the National Internal Revenue Code. Among others, the proposed measure requires foreign individuals employed by Offshore Gaming Licensees (OGL) to pay personal income tax of 25% on gross income received. HB 5777 also imposes a 5% excise tax based on gross gaming revenues or receipts to be remitted directly by PAGCOR or by the concerned Special Economic Zone Authority to BIR. Finally, HB 5777 clarifies that OGLs shall be considered engaged in doing business in the Philippines, hence liable to payment of proper taxes. |
