Congressman Expects a Quick Passage of POGO Tax Reform Bill
House Ways and Means Committee Chair Joey Salceda expects a quick passage of the Philippine Offshore Gaming Operators (POGO) tax reform bill after Congress adopts its Senate version.
Salceda stated, “At my recommendation, the House will adopt the POGO tax regime approved by the Senate. That version contains only minor reworkings of the House version, and there is no difference between their tax rates and tax bases and those of the House version.”
Salceda also noted that the bill’s quick passage will allow over ₱175 billion in revenue for the government in the next five years.
Salceda added, “[Congress] created 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.”
Under House Bill (HB) No. 5777, POGO will be subject to a 5% tax on gross gaming receipts.
POGOs service providers will also be subject to regular taxes, while non-resident employees of both will be subject to a withholding tax of 25% of gross income, with a presumed income of ₱600,000.
Moreover, all foreign POGO employees must obtain a Tax Identification Number (TIN) to be legally allowed to work under the said industry. Companies who fail to comply will be subject to a ₱20,000 fee for every employee without a TIN.
For POGO employees, the bill provides a minimum final withholding tax due of ₱12,500 for any taxable month.
Salceda projects that POGO taxes will rise to ₱13.4 billion in its first year and ₱176.9 billion in five years.
Salceda concluded, “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.”