Despite the challenges POGOs faced during the pandemic, tax revenues increased by 11.71% - still short of 2020 target
In the Philippines, the Bureau of Internal Revenue (BIR) disclosed that they have collected a total of PHP7.18 billion (US$151 million) taxes from the Philippine Offshore Gaming Operators (POGOs) for the year 2020.
This was up by 11.71 percent compared to P6.42 billion in 2019, despite the suspension of operations last year due to COVID-19 lockdown measures, the limitations on operational capacity imposed on companies as part of health protocols, and the flight of many operators, but it still falls short of its target.
In a statement on Tuesday, the BIR disclosed that its collections from POGOs continued to increase every year since 2018.
The BIR said that its collections from POGOs continued to climb from P2.36 billion in 2018, it grew by 172.43 percent in 2019 and by 11.71 percent in 2020.
In May last year, the government allowed some POGOs to operate while several parts of the country remain under strict lockdown. POGOs deemed not tax-compliant were prohibited from resuming operations.
The government gave the green light to some POGOs to resume operations on May last year while the country remained under strict lockdown. However, firms that failed to fulfill their mandatory tax obligations were forbidden to operate.
As POGOs flee the country due to stricter regulations, the Supreme Court (SC) on January 5, ordered a temporary restraining order on the 5-percent franchise tax imposed on POGOs.
POGOs executives have insisted they are not liable to pay the 5% franchise tax since they are an offshore business.
According to the data released by PAGCOR (CEO Andrea Domingo pictured), there are now only 51 POGOs that are licenced by the regulator, deriving from 60 prior the COVID-19 pandemic.
According to the Andrea Domingo, CEO and chairperson of PAGCOR, the regulatory body is pivotal to the country's economic development as she previously stated, during the online segment of SiGMA Focus Asia digital conference, that:
Whatever PAGCOR earns, 75% goes back to the national government - we retain 25% for our social civic projects and for social civil projects for the President of the Philippines. It is also important because it shows that through regulation - if you do it with sincerity, competence and integrity, from 56 million pesos contribution of offshore gaming operations in 2016, it is now a multi-billion pesos revenue generating operation under PAGCOR
Only 34 out of the 51 have been permitted to resume operations on a limited capacity as of Jan. 5. Further, there are 131 local gaming agents and service providers who have secured authority to resume operations.
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