(NOVEMBER 18, 2019) – The ways and means panel at the lower house of Congress has approved a bill imposing new taxes on the controversial Philippine offshore gaming industry, a lawmaker said on Monday.
Albay 2nd District Representative Joey Salceda, who chairs the house committee on ways and means, said they had unanimously approved the proposed House Bill No. 5267, which sets a 5 percent franchise tax for Philippine Offshore Gaming Operators (POGOs).
The revenue measure also seeks to impose a 25 percent income tax on workers earning $1,000 or P50,000 per month.
If passed into law, it will raise P45 billion for the national government, Salceda said.
“Ang gambling ay ‘di promoted activity. Instead of prohibiting them, the best way is to tax them,” he said.
Last September, the government threatened to shut down POGOs that have failed to comply with tax liabilities of their foreign workers.
Tax liabilities of POGOs have grown to P21.62 billion despite the issuance of 130 letter-notices, the Department of Finance reported.
But the Office of the Solicitor General said the gaming sector cannot be taxed as it earns from bets placed by registered foreign subscribers, based on a report of the Philippine Star.
The position did not sit well to some senators, including Minority Leader Franklin Drilon, who described it as “misplaced and misguided” opinion that may “open a can of worms” in the country’s tax system.
“The government has the right to tax POGOs, consistent with the position of the economic managers. POGOs owe the government billions in unpaid taxes,” Drilon said.
The Chinese government has called on the Philippines to prohibit online gambling, after the latter imposed a moratorium on new applications for POGOs in August.
An estimated half a million Chinese are employed in POGO since President Rodrigo Duterte came into office in 2016. Gambling is illegal in China forcing people to flock into casinos and bet on online games in most Southeast Asian companies.
The administration, however, has yet to make a stand on whether it will heed Beijing’s appeal. (Karen Macalalad/MM)