A bill seeking to impose a 5 percent franchise tax on gross winnings of Philippine Offshore Gambling Operators (POGOs) is scheduled to be heard by the plenary next week.
Representative Joey Salceda, who proposed the measure, told local media that the tax aims to raise as much as P60 billion for the government.
Salceda is pushing the bill ahead despite a legal opinion from the Office of the Solicitor General that the POGOs cannot be taxed, citing a “source of income” provision in the tax code.
“Essentially, Pagcor (Philippine Amusement and Gaming Corporation) should collect the five percent from the POGOs and remit it to the BIR,” Salceda was cited as saying in the Manila Bulletin. “They are paying the income tax, especially the service providers. But nobody pays the five percent.”
Salceda also said his panel decided to impose a 25-percent withholding tax on foreign nationals employed in the Philippines by an offshore gaming licensee with a minimum threshold of P600,000 per annum, instead of 15 percent tax, which was originally proposed.
The government has been pushing to close irregularities in POGO operations such as illegal workers and is seeking to collect the correct level of taxes.