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Online Gambling Support Service In Philippine To Pay Tax Bill

A major online gambling support service based in Philippine has resumed operations after they agreed to settle all tax arrears they owe the government. On the other hand, the government is considering plans to increase online gambling taxes.

On Tuesday, the media in Philippine media that the BIR (Bureau of Internal Revenue) had suspended the closure order which was imposed on GEGAC (Great Empire Gaming and Amusement Corporation) last week. The company is one of the leading support service provider for POGO (Philippine Offshore Gaming Operators).

The BIR made claims that GEGAC have not been paying their taxes as they’ve failed to register with the agency for VAT reasons. When the company was shut down, about 8,100 staff – most of which were Chinese nationals – lost their jobs. Thankfully, the BIR has released a statement that GEGAC has complied with its duties under the National Internal Revenue Code.

On Monday, the GEGAC resumed services at their offices. There are reports that BIR owes about P1.3b (US $25 million) in taxes. According to the BIR, the said that GEGAC has agreed to pay P250 million upfront and they’ve pledged to balance the payment within the next 3 months by issuing post-dated checks. In addition, GEGAC agreed to bring its withholding tax payments up to date and to register all their employees with the agency.

Some few months back, the BIR went hard on POGOs they believed to be flouting the law as regards registering employees for tax reasons. The government of Philippine estimated that they were losing about P2 billion ($39 million) every month from unregistered POGO employees.
In August this year, the government was pressured by the People’s Republic of China, urging them to place a ban on all forms of online gambling. The reason as because POGOs cater majorly to gamblers from mainland China. Rodrigo Duterte, Philippine President decided to not to buck under pressure because of the income the growing industry was earning the government.

Prior to the announcement by the President, the Philippine government decided to study the financial impact shutting down POGOs. On Tuesday, Benjamin Diokno, Central Bank Governor of the Philippines declared that he’d prefer POGO’s leave the country.

Diokno stated that POGOs could be beneficial in a situation where they pay their taxes. He also said that these benefits wasn’t significant as it amount to a few billion pesos to the annual budget of the government. In the meantime, POGOs also suffer the risk of money laundering and the risk-averse Central Bank Governor, Diokno said he would not lament a complete shutdown of POGOs.

The tax contribution of POGOs could increase if local pols have their way. Ways and Means Committee of the House of Rep is drafting bill that could enforce a “presumptive corporate income tax” of $1000 per employee. A system the government believes could increase its annual revenue to about P76 billion ($1.46 billion).

Source: https://calvinayre.com/2019/10/01/business/philippine-online-gambling-support-service-pays-tax-reopens/

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Jo Arazi

Jo Arazi

Jo is a seasoned writer and analyst of the cryptocurrency market with several years of experience writing for various blogs and websites worldwide. He has worked with several crypto startups and is a supporter of credible crypto projects worldwide.

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