POGO just can’t call it quits, must pay tax due

In file photo: A guard at a Philippine Offshore Gaming Operator (Pogo) office checks the temperature of Chinese workers before they enter the building as part of precautions against the spread of the 2019 novel coronavirus.

DESPITE deciding to cease its operations in the country, a Philippine Offshore Gaming Operator (POGO) is not yet off the hook as the government vowed it will still go after its tax dues.

Citing information from the Bureau of Internal Revenue (BIR), Finance Secretary Carlos G. Dominguez III on Monday said SC World Development Group Ltd.—a unit of Macau’s gambling giant SunCity Group—is an offshore licensee and it is not registered with the BIR.

SC World Development Group Ltd. is one of the two POGOs identified by the Philippine Amusement and Gaming Corp. (Pagcor) that have officially asked for cancellation of their offshore gaming licenses, according to reports.

“We still intend to go after its tax dues,” Dominguez said, quoting the BIR.

Aside from SC World Development Group Ltd., another POGO reported to be exiting the country is Don Tencess Asian Solutions Inc.

According to the information from BIR relayed by Dominguez to reporters, Don Tencess Asian Services Solutions Inc. is a “local licensee and already paying franchise tax, and will be subjected to investigation before it will be given clearance to close by the BIR.”

Aside from these two POGOs, 13 other service providers were also reported to have also closed down their operations and more will likely follow suit due to stringent tax rules from the BIR and the impact of movement restrictions amid the Covid-19 pandemic, according to Pagcor.

The government allowed the partial resumption of operations of POGOs in May in an attempt to raise some revenues while several
parts of the country remain under lockdown in a bid to curb the spread of Covid-19, but POGOs that were deemed not tax-compliant were prohibited from resuming their operations.

POGOs, however, are insisting that they are not liable to pay the 5-percent franchise tax since they are an offshore business.

Last week, Sen. Joel Villanueva said only two POGOs have  so far paid the franchise tax.

Responding to Villanueva’s claims, Dominguez said they are looking into it, but described the allegation as “probably true.”

While the Department of Finance has said that government revenues from POGOs are estimated to reach up to P20 billion annually, total tax collections from the industry only amounted to P6.42 billion in 2019. This, despite the government’s intensified crackdown against tax-dodging POGOs.

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