The Philippines House of Representatives has passed a measure on final reading that will impose substantial new taxes on both licensed POGOs and foreign POGO workers.
As per a report by the Inquirer, the lower chamber voted in favor of House Bill 5777 by 198-13, with the new taxation scheme expected to raise additional annual revenues of around Php45 billion (US$935 million).
The Bill will see licensed POGOs pay a gaming tax of 5% on gross gaming revenues and POGO workers earning Php600,000 or more a 25% withholding tax.
Accredited POGO service providers – those providing online gaming operations under the license of a POGO – won’t pay any gaming taxes but will be liable other local and national taxes.
The imposition of a 5% gaming tax on POGOs will replace other taxes such as franchise taxes, levies and fees, the Inquirer report states.
The Philippines has been looking to crack down on any POGOs failing to meet their tax obligations, with only 34 of 51 official licensees having been granted permission to resume operations since the lifting of a ban on all operations during the early days of the COVID-19 pandemic. A total of 131 service providers are authorized to run online gaming platforms under those 34 approved POGO licenses.
PAGCOR and the Bureau of Internal Revenue (BIR) announced in May 2020 that all POGOs and their service providers must fulfil certain prerequisites before being given the green light to resume, including settling any outstanding tax liabilities as certified by the BIR, updating payment of any regulatory fees, license fees, performance bonds or penalties owed to PAGCOR, and remittance of all regulatory fees.
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