Internationally-licensed gaming operators in the Philippines must register with the Bureau of Internal Revenue (BIR), the agency said.
In Revenue Memorandum Circular 78-2018, Commissioner Caesar Dulay said that Philippine Offshore Gaming Operators (POGOs), which cater to gamblers outside of the Philippines, are considered resident foreign corporations “engaged in business in the Philippines,” and not nonresident foreign corporations.
“All Foreign-based and Philippine-based Operators, including those have already been issued an Offshore Gaming License by [state regulator] PAGCOR are required to register with the Bureau of Internal Revenue on or before payment of any tax due; or before or upon filing of any applicable tax return, statement or declaration as required by the Tax Code, as amended, whichever comes earlier,” the circular read, adding that operators will have to register at the Revenue District Office that has jurisdiction over them.
Specifications are given for the submission of documents, depending on the registering entity. The documents include a Philippine Securities and Exchange Commission (SEC) certificate of incorporation, mayor’s business permit, and various BIR forms.
The new circular was meant to clarify Circular 102-2017 from 2017, which states that POGOs are to be taxed 5% of their income “in lieu of all kinds of taxes, levies, fees or assessments of any kind, nature or description.”
Given that the POGO scheme was devised to draw foreign companies to invest in the country, the new requirements might lead some to reconsider.
In addition, sources told CalvinAyre.com that Philippine Amusement and Gaming Corporation (PAGCOR) is now asking for three years of licensing fees to be paid up front, rather than the one-year advanced payment when the POGO licenses are issued by the agency.
In 2017, 35 POGOs contributed P3.13 billion ($58.1 million) in gaming revenue, which PAGCOR said was poised to double this year, with more firms being awarded POGO licenses. PAGCOR charges application and processing fees of $50,000 for e-casino and $40,000 for sports betting, and another $200,000 and $150,000, respectively, when these licenses are approved.