(File photo)
MANILA – The House of Representatives will adopt the bill clarifying the tax liabilities of Philippine offshore gaming operators (POGOs) as approved by the Senate.
House Ways and Means Committee chair and Albay Representative Joey Salceda said the Senate version of the POGO tax regime contains only minor reworkings of the House version, noting that there is “no difference” between tax rates and tax bases.
“We were the first draft, and they made very few modifications. So, recognizing the respect that the Senate extended to the House version, we will adopt their changes, which in my view are acceptable,” Salceda said in a statement.
He expressed gratitude to President Rodrigo Duterte for certifying the bill as urgent and for the Department of Finance’s (DOF) support to ensure its passage.
“I personally wrote this bill to ensure that we get the proper taxes from POGOs, and that they are properly monitored and regulated,” he said.
According to Salceda, the Senate version requires every alien employee of offshore gaming licensees (OGL), commonly known as POGOs, to have a Tax Identification Number (TIN).
A fine of PHP20,000 will be imposed on the OGL for every alien employee without a TIN.
One major change is the removal of the provision that POGOs currently registered with other special economic zones will pay at their current tax rate or 5 percent of gross gaming revenues, whichever is higher.
Instead, the adopted version makes the 5 percent rate uniform.
The Senate version also prevents the Aurora Pacific Economic Zone and Freeport from issuing new POGO licenses and transfers POGOs currently registered under the zone to the regulatory ambit of the Philippine Amusement and Gaming Corporation.
Salceda further noted that the Senate version does not specifically provide that the income reported by POGO employees for tax purposes can be used as a basis for the computation of other mandatory contributions.
“We would have preferred that they keep this, but anyway, no one stops the other government corporations from using the presumptive income under the POGO tax regime as their basis for computing mandatory contributions,” he said.
He said the taxable period for the Senate version, for both POGO taxes and employee taxes, is monthly.
On the other hand, the House version provides that the remittance of taxes for POGO employees is on a quarterly basis, while the taxable period for POGOs in the House version is annual, as in the case of other corporations.
Salceda said POGO taxes are projected to raise PHP13.4 billion in its first year, and P176.9 billion in five years.
The bill imposes a 5 percent tax on gross gaming receipts for “offshore gaming licensees” and a 25 percent tax on gross income for nonresident aliens working under the Service Providers of these licensees.
For POGO employees, the bill provides a minimum final withholding tax due of PHP12,500 for any taxable month.
“On top of the tax provisions, we also instituted stringent measures to monitor their personnel, supervise their operations, and punish them for violations of the law. By making POGO taxes a part of the Tax Code, they become subject to all the applicable penalties in the Code, including tax evasion,” he said. (PNA)
