THE BUREAU of Internal Revenue (BIR) has asked the Philippine Amusement and Gaming Corp. (Pagcor) to include proof of tax registration and payment as a requirement to renew the licenses of offshore gaming operators, who have hired a growing number of workers from China.
In a statement on Sunday, the Department of Finance (DoF) said that the bureau wants to go after Philippine-based offshore gaming operators (POGOs) and has asked Pagcor not to renew their licenses to operate until they are registered with the BIR.
The BIR also said that it is looking to join an inter-agency task force led by the Department of Labor and Employment (DoLE) and the Bureau of Immigration, at a time of increasing number of foreigners taking on POGO jobs in the country.
Pagcor crafted rules for POGOs in 2016, as the government positioned to capture the huge foreign interest in online gambling. Last year, the gaming regulator targeted to rake in as much as P6 billion in additional revenues from this gaming platform.
More than 50 POGOs have set up businesses since President Rodrigo R. Duterte’s government began awarding licenses in 2016, triggering the migration of tens of thousands of Chinese workers.
Of the more than 115,000 permits given to foreign workers from 2015 to 2017, 51,000 were issued to Chinese nationals, an official of the Labor department said in November. More than 3 million Chinese have entered the Philippines from 2016 and many of them have applied for work permits, the Labor official said.
“We want to trace these Chinese nationals employed by these gaming operators. They allowed us to join the task force because we are asking data from Immigration and DoLE on the list of these foreign nationals,” the DoF statement on Sunday quoted BIR Deputy Commissioner Arnel SD. Guballa as saying.
A POGO is a business that provides games to players, taking bets and paying the winners through an online gaming account.
BIR had issued Revenue Memorandum Circular (RMC) 102-2017 which outlined taxes for POGOs, which is treated as a resident foreign corporation doing business in the Philippines. This includes a five percent franchise tax for gaming income in lieu of all kinds of taxes, levies, fees or assessment; income tax, value-added tax, and other applicable taxes for non-gaming revenues; as well as withholding tax for their employees and service providers.
The succeeding (RMC) No. 78-2018 required POGOs to sign up with the BIR, but the tax bureau is now asking Pagcor to step up enforcement.
Teams of the gaming regulator and law enforcers raided some 170 establishments which were discovered to be operating without proper licenses as of June 2018, taking off from Executive Order No. 13 issued by Mr. Duterte in 2017 that sought to “intensify the fight against illegal gambling.”
Pagcor saw revenues rise to P67.85 billion in 2018, 18.3% more than what it raked in the past year due to a one-time gain from the sale of a 16-hectare land in Parañaque City. The regulator netted P37.3 billion from that sale to Bloomberry Resorts Corp., operator of Solaire Resort & Casino.
Other key considerations include whether the Chinese and other foreign workers rendering POGO services here carry valid alien employment permits.
Chinese POGO workers are seen to be driving demand for residential properties, particularly in the Manila Bay area which is close to the Entertainment City casino hub. — Melissa Luz T. Lopez with Bloomberg

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