The Philippines to Introduce New Taxes For Gambling Industry
Philippines President Rodrigo Duterte has turned his attention towards the online gaming industry in an attempt to overturn the country's debts. The sector is big business in the country and the government will be looking at the POGO industry very closely.
National Debt Needs Clearing
The country intends to generate more tax revenue from the industry to help cover some of its financial losses. The new proposal would see a 25% income tax on foreign employees in the industry and a 5% tax on offshore online casino operators.
The Philippines has found itself in an increasingly poor economic situation in recent years. At the end of March this year, its debt sat at around $512.87 billion. A lot of this debt has occurred as a result of the Covid-19 pandemic and the pressure that it put on the country. The debt includes 72% from domestic loans and borrowings and 28% from outside sources.
The bill to bring about these changes is called SB2232. Also, the President has labeled it as urgent. In a statement last Monday, a spokesperson for the President said that they hoped the bill would help the government get stricter control over the industry.
Missed Opportunities In the Past
The bill is being sponsored by Senator Pia Cayetano. She believes the iGaming industry could have been a much more useful source of revenue for the country. Furthermore, she believes that the government has been too relaxed on taxing the industry and that they have missed an opportunity.
The Philippines is a popular hub for iGaming, with many companies operating from there. The chances to gain revenue for the country are no doubt high. Some feel as new gambling tax laws could be a deterrent for these companies though.
The POGO Industry
The POGO industry is one of the biggest online sectors in the Philippines. It stands for Philippine Offshore Gaming Operators and is based around operators who work in the Philippines but offer their services to other markets. In 2019, official figures stated that there were 56 licensed POGO companies. It was also believed that there were up to 30 firms operating illegally.
Many of these companies cater to other markets in Asia, with China being the biggest benefactor. It is a big employer of immigrants in the country, with an estimated 140,000+ working in the industry. In fact, only around 17% of POGO workers are predicted to be from the Philippines. This has made it difficult for the country to regulate its actions. As such, it has been a source of debate within parliament there for several years now.
The industry has not been without its controversies though. At one point, China was putting pressure on the country to regulate it better. There were even calls for them to shut it down due to fears of Chinese labor exploitation. There was also an investigation into the casino industry in the Philippines at the end of 2019. This was to see if casino resorts and operators in the country had been compliant with tax laws.
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