THE government collected a total of P6.42 billion in taxes from Philippine Offshore Gaming Operators (POGOs) and their service providers in 2019, according to the Department of Finance.
The 2019 tax collection on the back of an intensified crackdown on errant POGOs showed an increase of 4.04 billion, or 169 percent, compared to the tax take of P2.38 billion from these businesses the previous year.
Finance Secretary Carlos G. Dominguez III vowed there will be no letup in the government’s efforts against tax-delinquent POGOs as the Bureau of Internal Revenue (BIR) committed to further step up its campaign this year.
“Basically we’re going hard against people who are evading taxes,” Dominguez said in a statement on Sunday.
Broken down, BIR collected P5.13 billion in withholding taxes, P644.07 million in income taxes, P91.13 million in value-added taxes (VAT) and percentage taxes, P81.11 million in documentary stamp taxes and P469.13 million in other taxes from POGOs.
Based on DOF’s estimates, at least P22 billion annually are not being collected in the income taxes from workers employed in POGOs, and other related industries based in the country.
For 2019, BIR also shut down the operations of at least four companies operating as POGO service providers but which either failed to register their operations—which allowed them to evade paying the right taxes to the government—or registered their operations but are still not paying the correct taxes.
Moreover, the bureau said it has issued 170 notices to collect P27.35 billion in tax liabilities from errant POGOs. BIR’s target was to collect at least P2 billion a month from POGOs, according to BIR Deputy Commissioner Arnel Guballa.
Guballa initially estimated that there are around 103,000 foreign workers in the POGO industry but based on BIR’s list there are 108,914 employees in 218 POGO service providers. The list was updated after cleaning up the data provided by the Philippine Amusement and Gaming Corp., Department of Labor and Employment (DOLE), Bureau of Immigration, as well as the ecozones.
Dominguez earlier expressed support for Albay Rep. Joey Salceda’s plan to file a bill seeking to impose additional taxes on the online gaming industry. These taxes include a 5-percent franchise tax, a 15-percent tax on the salary of any individual who is a permanent resident of a foreign country and employed by a licensed offshore gaming enterprise.
Upon Dominguez’s instructions, BIR is also working with DOLE in developing an interagency database of foreign nationals working in the country to effectively monitor and ensure that POGOs pay the correct amount of taxes to the government.
Image credits: Asia Times