If the online gambling operators in the Philippines do not catch up with the payment of their taxes, they run the risk of being ‘shot’ or ‘slapped’ by President Rodrigo Duterte, who has already issued strong warnings in this regard.
In an interview with CCN Philippines, Duterte gave a 24-hour deadline to Philippine offshore game operators (POGO) to resolve their pending tax obligations with the Internal Revenue Office (BIR).
However, Duterte then said that the maximum term for operators would be “at least three days”, which in his opinion is “good enough” for operators to fulfill their obligations. For Tuesday, when the deadline has already been closed, the Philippine authorities are expected to carry out raids in the POGO that have not yet met.
POGOs are being scrutinized deeply by the country’s authorities, as they are a very important source of income for the government. Agents of the BIR and other official organizations have practiced several raids on these premises, among them important providers of POGO support services such as the New Oriental Club 88 Corporation. Companies are accused by the government of not paying their taxes or correctly registering their operations with the BIR.
In its traditional flowery language, Duterte has given an ultimatum to the POGO operators making a simile with the quail hunt (pugu). The president has said he will ‘shoot’ the operators who do not comply. During the interview, Duterte said it was better for POGO operators not to put him to the test and threatened to “slap” those who try to cover their eyes.
The issue of POGO taxes has been on the table in recent times in the Philippine parliament, where various proposals have been discussed to further tax these establishments and ensure that the state earns more revenue from online gambling.
However, some sectors do not agree with the Philippine government. One of them is the head of the Philippine Corporation for Games and Entertainment (PAGCOR). The agency in charge of the supervision of POGO’s licenses and regulations is concerned as it considers that if the licensed online operators are squeezed out with too much taxes, the only thing that will be obtained will be greater growth of illegal online gambling.
The tax repression of the government against the POGO has so far contributed additional income in the order of P1.2 billion (US $ 25 million), according to figures from the Department of Finance. Most of the revenue has been the result of the raid on the offices of the Great Empire Gaming and Amusement Corporation in September. The company was able to restart its operations after an agreement with the BIR.
POGOs represent “approximately 10% of the total leasing offices in Metro Manila,” Colliers International Philippines recently reported. In the first months of this year, transactions related to POGO constituted “37% of all closed businesses”.
Colliers has said, however, that the POGO will continue to “lead the office space in the next two or three years,” if the government does not finish frightening the sector and leads it to seek more tolerant regulatory jurisdictions.