The Philippine Charity Sweepstakes Office (PCSO) missed its P70.6 billion revenue target for 2019 pointing to the many “internal and external setbacks” that the government-owned and -controlled corporation faced throughout the year.
In its 2019 year-end report, the PCSO said they generated a total of P44.028 billion last year from its Lotto, Keno, Small Town Lottery (STL), Peryahan Games, Instant Sweepstakes and Traditional Sweepstakes.
Compared to its full-year 2019 target, PCSO fell short by 37.64 percent or around P26.57 billion.
This was also a 30.74 percent-drop from the P63.567 billion it earned in 2018.
In its 2019 performance scorecard, the PCSO attributed the decline in ticket sales to several factors, including President Duterte’s order to suspend all of its games and the imposition of Republic Act 10963 or the Tax Reform for Acceleration and Inclusion (Train) law.
“The suspension of all PCSO games, mandated by no less than the President of the Philippines, for more than a month, also made a significant impact in the sales generation of the agency. During this period, the agency lost P2.960 billion,” it said.
To recall, the President temporarily suspended all gaming activities under PCSO due to alleged massive corruption last year.
Aside from this, the PCSO said the provision of Train law, specifically on the imposition of a 20-percent final tax on winnings and another 20-percent documentary stamp tax led to the price increase, which had “detrimental effect to price-sensitive customers.”
Nonetheless, the PCSO said it has taken necessary steps to address the declining sales of their games through renaming its digit games and implementing distance restriction between Lotto and STL outlets to ensure maximum coverage of areas and allow agents to cater to as many clients as possible.
The PCSO said it also reverted the bet cost of Keno from P12 to P10 to make the Keno game more attractive to the gaming public.
The continuous operation of illegal number games also dealt a blow to sales, according to the PCSO. To neutralize illegal gambling operations, the PCSO said it improved its collaboration with the Philippine National Police to address this issue.
In addition, the objection of local government units (LGUs) to allow STL to operate in their jurisdiction without the necessary permit issued by the concerned LGU and the occurrence of natural calamities were also cited by the PCSO as among the external factors that affected their revenue last year.
The PCSO also identified the failure to remit sales leading to termination of STL agents as one of the internal issues that led to revenue shortfall last year. The PCSO noted it has an outstanding collectible amount of P4.5 billion from delinquent and terminated STL authorized-agent corporations.
Under the amended PCSO charter, the net receipts generated from the sale of sweepstakes tickets, whether for sweepstakes races, lotteries, or other similar activities, shall be divided into prize fund (55 percent), charity fund (30 percent), and operating fund (15 percent).