Tax Revenue from Philippine Offshore Gaming Operators Surges by 127% to Reach P8.9 Billion in 2022

MANILA, Philippines (July 24, 2023) — The government’s tax intake from Philippine offshore gaming corporations (Pogos) ballooned by 127 percent to P8.88 billion last year from P3.91 billion in 2021, Business Inquirer reported data from the Department of Finance revealed.

The surge in Pogos’ tax payments to the BIR was observed despite the declining presence of these firms in the country.Also, the significant increase in government revenues from Pogos came as the Philippine Amusement and Gaming Corp. reported a substantial jump in industry-wide earnings as well as its own, thanks to resurgence of activities amid continued economic reopening.

Of total payments made by Pogos, P4.35 billion was in the form of withholding tax, P3.65 billion from gaming tax, and P806 million from income tax.

The balance comprised of P43.2 million in business tax, P19.42 million in documentary tax stamps, and P9 million in other taxes.

Last week, Pagcor chair Alejandro Tengco said gross gaming revenue generated from Pogos was expected to reach P24 billion by the end of 2023, more than double the P11 billion received last year.

This was the outlook even if the number of registered Pogos decreased to 32 from its prepandemic peak of 281 in 2019.

Tengco said Pagcor had implemented strict measures to impose hefty fines and penalties on Pogo licensees and service providers who are found to be engaged in criminal activities.

Aside from the Pogos themselves, there are 106 service providers accredited with Pagcor.

Meanwhile, Pagcor has canceled the licenses of 46 Pogos and 228 service providers, including those in the special class of business process outsourcing.

Last March, Pagcor announced that it decided to end its consultancy contract with a company engaged in auditing the revenues and cash flows of Pogos, citing their failure to fulfill contractual obligations and alleged engagement in unlawful acts.

Meanwhile, Tengco said that Pagcor has accredited gaming system service providers for a range of gaming categories, such as traditional Bingo, electronic Bingo, electronic (eCasino) Games, sports betting, and e-billiards.

Also last week, Pagcor said it planned to launch in the first quarter of 2024 of its online casino, which is expected to further boost market growth, provide a more convenient gaming experience to players, and encourage healthy competition.

In a statement, Pagcor chair and chief executive Alejandro Tengco said that the planned online casino — called casinofilipino.com — is intended to use virtual reality-based technology that can simulate the sights and sounds of a physical casino, thereby offering a realistic and immersive gaming experience.

The online casino “will allow players to interact with the digital counterparts of traditional casino games. It will also transcend physical boundaries and will enable users from around the world to interact and participate in virtual environments,” Tengco said.

SOURCE: Business Inquirer.