Employees set to pay more taxes
New legislation introduced by Albay Representative Joey Salceda aims to introduce further taxes on foreign employees of Philippines Offshore Gambling Operators (POGOs) who work in the country.
around 130,000 non-Filipinos work in the POGO space
As these companies are managing their operations from a base in the Philippines, Salceda believes that those working for these firms should have to face taxes. These operators do already have certain tax obligations, but there is not a specific tax code that relates to their staff’s income.
According to estimates, around 130,000 non-Filipinos work in the POGO space. The Philippines can benefit from a $475m boost annually for every 100,000 foreign POGO workers that pay taxes.
Breaking down the levy proposal
If House Bill 5267 gets approved, a 15% levy could be imposed on the wages, salaries, and other types of compensation for their foreign employees. This legislation also suggests an extra 5% tax on the gross gaming revenue of POGOs.
Salceda believes that a new code system would be ideal for the POGO taxation regime. It would make it easier for the government authorities to supervise the industry, leading to improved intake of taxes. It will also provide more accurate figures for the number of employees POGOs have in the country.
Increasing pressure from China
It was back in August that China started pressuring countries in the region to ban online gambling. While Cambodia complied with this request, the Philippines refused.
China is concerned that some of the POGOs are targeting Chinese residents
This led to some tension between China and the Philippines. China is concerned that some of the POGOs are targeting Chinese residents. Gambling in most forms is banned in mainland China.
China is also concerned about the illegal flow of funds into the Philippines. This includes the likes of laundering money across borders.
Presidents meet
There was a meeting between Philippines President Rodrigo Duterte and the President of China Xi Jinping.
The Philippines is also looking to extradite any Chinese nationals who are working at POGO centers.
In October, eight POGOs were raided, which led to 324 Chinese nationals being detained for operating online gambling that is unauthorized.