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Pagcor supports closure of erring POGOs

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By Chino S. Leyco

The Philippine Amusement and Gaming Corp. (Pagcor) said that it fully supports the Department of Finance (DOF) and the Bureau of Internal Revenue’s (BIR) call to shut down tax-dodging offshore gaming companies operating in the country.

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Andrea D. Domingo, Pagcor chair and chief economic, said that they are with the tax authorities in cracking the whip on Philippine offshore gaming operators (POGOs) that fail or refuse to pay income taxes of their foreign employees.

“We follow the law. The BIR has the legal authority to close down establishments that evade taxes,” Domingo told reporters in a mobile phone message after Finance Secretary Carlos G. Domingos III ordered the closure of tax-delinquent POGOs. “Pagcor supports this move.”

Domingo also said that Pagcor will be issuing a letter to all POGO companies and service providers reminding them to follow the country’s tax law being implemented by the BIR.

She, meanwhile, assured that the gaming regulator has its own measures to hold POGO licensees accountable should they renege on their financial obligation. Among these measures were the imposition of interest on outstanding arrears, forfeiture of performance bond, imposition of demerits/administrative sanctions and charging of cash penalty, cancellation of license and endorsement to legal division for proper collection efforts.

The Pagcor chief also reiterated that the moratorium on the issuance of new POGO licenses continues to take effect.

Earlier, Dominguez directed the BIR to shut down the operations of erring POGOs after learning of the slow pace collections of withholding income taxes despite the issuance of 130 letter-notices to offshore gaming firms.

The finance chief, who convened last Friday the interagency task force monitoring the entry of foreign workers in the country, also ordered the the BIR to file the appropriate cases against tax-dodging POGOs.

“Why don’t we start closing them down so they will answer these assessments,” Dominguez said during the interagency meeting. “Those who don’t pay or respond to your assessments, clamp them down.”

The BIR already asked the assistance of the Department of Labor and Employment (DOLE), the Bureau of Immigration and Pagcor in closing down errant POGOs.

During the interagency meeting, the BIR reported that POGO service providers paid P175 million in withholding taxes in 2017 and P579 million in 2018.
In January to August this year, the BIR already collected P1.4 billion from POGOs, representing a 242 percent increase from the previous year’s collections.

Dominguez, likewise, told the BIR to ensure that the payment of the tax liabilities should account for each foreign worker in POGOs and to reject any “lump sum” offer or any other arrangement in paying their tax arrears.

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