A lawmaker opposed a bill on Tuesday seeking to impose a 5% franchise tax on Philippine Offshore Gaming Operations as well as another 25% tax on POGO employees. Speaking to ANC’s Headstart, Albay 2nd District Rep. Joey Salceda, author of House Bill 5267, identified POGOs as ‘ exported jueteng ‘ with kabos (bet collector supervisors) located in the region.
It’s jueteng exported. Ano ba ang problem? So nandito ‘ yung mga kabo, ‘ he said, adding that government could raise POGO taxes up to P45 billion. Salceda said POGO employees have to pay taxes on income as these foreign nationals are coming to work in the Philippines.
He challenged the opinion of the Solicitor General’s Office that, under the country’s tax code, the government could not impose taxes on POGOs based on the principle of the source of income. The issue with that is, one, the 100,000 employees in Pasay, Parañaque are doing nothing? There’s nothing. You remember the income generated hereby ergo, he told ANC’s Headstart.
Yes, the bet is in China, but we have the supporting infrastructure and resources here. So there have been profits or value-added here and that should be paid.
Official labor department data showed that there are 119,000 Chinese nationals with alien work permits or special work permits working in POGOs in the Philippines, even as other countries refused POGOs. The lawmaker said these POGO workers earn up to 10,000 yuan or around P72,000 a month. Where are they going? In Japan? That’s not willing. Korea? Not willing. Hong Kong, not willing. Macau, it’s full, it’s not permitted under China. Indonesia, no gamble. In Malaysia, Singapore, where are they going? We’ve just issued a lot of work permits.
Filipino employees from overseas who work in China often pay taxes on income. It’s automatic. That’s why when they come back, we don’t tax them,” he said.
The lawmaker also questioned why only 10 out of 60 licensed POGOs are registered with the Bureau of Internal Revenue. The 50’ are not registered with BIR. I don’t know by any logic why there are 10, he said.
He added that the taxes do not preclude POGOs from placing a 2 percent regulatory fee on the Philippine Amusement and Gaming Corporation. Presidential Decree 1869 consolidating all PAGCOR legislation specifies that all gaming income should be subject to a 5% franchise charge, he said. What we do is 2 to 5 percent so that the government receives P20 billion doing nothing. The salt doesn’t have to be taxed, average Filipinos don’t have a pocket, he said. He said the move should be a welcome development for POGOs because it’s almost a way to legitimize them.
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