Philippine-based game operators face additional tax increases as the government seeks money to fund its economic recovery from the COVID-19 pandemic.
On Saturday, Philippine Senate minority leader Franklin Drilon announced that the Bayanihan to Recover as One (Bayanihan 2) act would more than double its monetary raising from Philippine overseas gaming operators (POGO) by applying an online gambling earnings tax than profits.
The law stipulates that POGO will now be subject to a “five according to the cent-deductible tax” (5%) gross bets or volume losses or at a pre-set minimum agreed in accordance with monthly gaming revenue consistent with game licensees abroad, adding games consistent with suppliers, gaming agents, service providers and game providers. »
To ensure that investors cannot use exchange rate fluctuations to reduce their tax obligations, the deductible tax “will be calculated on the weight equivalent of the foreign currency used, based on the official exchange rate in effect at the time of payment, if not a fraudulent act constituting a sub-declaration of taxable income or income. »
Failure to comply with these new tax regulations will allow the Office of Internal Revenue (BIR) to “implement closing orders” opposed to violators and “those entities will stop their operations”.
Philippine President Rodrigo Duterte signed the new law on Friday and Drilon, who claimed duty for the addition of the POGO amendment, said the government would now raise about 17. 5 billion pesos ($361. 2 million) from POGO in 2020, more than double the amount raised through the government’s online gambling sector last year.
The POGO sector has experienced a significant contraction over the following year, with the government expanding its surveillance and blockade in the occasion of a pandemic that forces operators within reach of its operations. In August, the government estimated that up to a hundred POGO had left the Philippines since the lockout began.
Officially, there was intended to be a constant limit of 60 POGO licensees, however, many night flight operators, many of whom operate in China, had settled in the country. Of the official licensees, only 29 had obtained IRRB authorization to resume activity. operations starting this month.
The official POGO list published through Philippine Amusement and Gaming Corporation (PAGCOR) earlier this month showed only 55 licensees, up from 58 in July. Cosmic Ace Holdings Ltd, Defun Global Investments Ltd and Ximax Holdings have made the decision that their POGO licenses are no longer valued.
To be sure, the new tax application will lead other POGOs to reconsider their presence in the Philippines. here in force in January.
Interestingly, a panelist at last week’s SBC Summit said Johor’s state in Malaysia could become the next back-office hub for online gaming. urban commune of Johor Medini, warned that Malaysia’s conservative Muslim majority can simply torpedo plans before they begin.
Get Calvin Ayre’s newest game