The Philippine government is set to crack down on remote gambling service providers that fail to register and pay due taxes despite repeated calls by the Department of Finance, local news outlets reported earlier today.
Today’s announcement comes shortly after China called on the administration of President Rodrigo Duterte to ban online gambling operators that provide their services to customers located outside the Philippines under the country’s POGO (Philippine Offshore Gaming Operators) program.
Philippine Finance Secretary Carlos G. Dominguez III said today that POGO license holders with unregistered foreign employees will be shuttered by the nation’s Bureau of Internal Revenue in cooperation with other government agencies.
Mr. Dominguez told reporters that they are ready to “close down organizations that don’t withhold and remit the proper amount of taxes from their employees.” The clampdown on tax-dodging operators is expected to kick off “ASAP”, it also became known.
The Finance Secretary further clarified that the looming crackdown would be conducted in cooperation with the Office of President Duterte, the Department of Justice, the Department of Labor and Employment, the Bureau of Immigration, and PAGCOR, the Philippine gambling regulator.
According to official stats, the Philippines’ POGO industry employs more than 130,000 non-Filipino workers, with the majority of them being Chinese nationals. The Bureau of Internal Revenue said last month that it collected PHP200 million in income taxes from foreigners working for locally licensed online gambling operators.
The Department of Finance had previously estimated that the country could annually take in PHP24 billion for every 100,000 foreign POGO workers, if they paid their tax dues. Andrea Domingo, Chairwoman of PAGCOR, said earlier this year that the country was on track to generate PHP8 million in licensing fees and royalties from POGOs by the end of 2019, up 33% from 2018.
No Ban On Online Gambling
Last month, PAGCOR announced that it would no longer accept POGO license applications due to concerns over the growing number of Chinese workers in the Philippines. China hailed that decision and said that the country should also consider banning POGO activities altogether.
Offshore gambling license holders are allowed to provide their services to non-Filipino customers located outside the Philippines. However, such gambling operators are mostly targeting Chinese gamblers, hence the massive number of Chinese nationals being employed in the sector.
Almost all forms of gambling are prohibited in Mainland China, but the country has been unable to prevent its residents from gambling on international websites. Its recent comments urging the Philippines to banish the sector were part of its efforts for a cross-border crackdown on remote gambling.
However, President Rodrigo Duterte said recently that while he hated gambling, he would not move to ban POGO activities as this would have a negative impact on the Philippines’ economy and the Filipinos employed in the sector. He went on that the POGO program has proved “good for the country” since it was launched in 2016.
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