Speedy approval of POGO tax bill seen
Credit to Author: Mayvelin U. Caraballo, TMT| Date: Wed, 27 Nov 2019 17:05:09 +0000
Measure would net P45B for govt if passed
ALBAY Rep. Joey Salceda is confident that the House of Representatives would hasten the approval of the proposed imposition of taxes on online gaming operators and their workers in the country.
According to Salceda, who leads the House Committee on Ways and Means, the proposal is scheduled to be tackled at the plenary next week after securing the panel’s approval on November 18.
House Bill 5267 seeks to impose a 5-percent franchise tax on revenues generated by Philippine offshore gaming operators (POGOs) and a 25-percent income tax on their workers.
“On the tax on POGO, we expect easy, expeditious action on the plenary, simply because it does not affect the pockets of ordinary people,” Salceda said during the Kapihan sa Manila Bay forum on Wednesday.
Asked for the bill’s importance, the legislator claimed it would generate an additional P45 billion in tax revenue for the national government.
This estimate, he explained, was based on findings that the POGO sector earns P600 billion, but only P400 million are going to the government.
Salceda also said he had called the attention of the Anti-Money Laundering Council (AMLC) to find out if these companies were being used for suspicious transactions.
“I have already written [the] AMLC for what are the suspicious transactions that are related to POGO operations,” he said.
The lawmaker also asked the Philippine Statistics Authority and the Bangko Sentral ng Pilipinas to recognize and take into account the contribution of POGOs to the country’s gross domestic product (GDP).
“Our GDP [would] rise automatically by 1.2 to 1.5 percent if POGOs [are] included in the national accounts,” he said.
Crackdown on tax-evading POGOs
Also on Wednesday, the Department of Finance (DoF) vowed that there would be no letup in the ongoing crackdown on tax-dodging POGOs and their providers as the government aims to secure a fresh revenue source by collecting unpaid income taxes from them, mostly employ foreign workers.
“Basically we’re going hard against people who are evading taxes,” Finance Secretary Carlos Dominguez 3rd said.
It is unfair to Filipino taxpayers dutifully paying their taxes for these POGOs to continue with their tax-avoiding practices, he added.
According to him, a task force led by the Bureau of Internal Revenue (BIR) has so far shuttered the operations of at least three such POGOs and collected an initial $25 million (about P1.2 billion) from one of them.
In September, the tax agency closed Great Empire Gaming and Amusement Corp. for also failing to register with the bureau.
However, it paid the BIR an initial P250 million and committed to pay the rest of its P1.3-billion total tax liabilities in three months ending December with postdated checks.
The BIR also shuttered the offices of Altech Innovations Business Outsourcing in Aseana City, Parañaque City and in Pasay City after failing to register as a value-added tax (VAT) taxpayer.
The latest to be closed are the unregistered POGO branches of the New Oriental Club 88 Corp. (NOCC), which was shuttered on Monday morning.
According to the BIR, the NOCC operates as a customer relations service provider and live-studio streaming provider with its main office in Makati City and several branches in Parañaque City.
Results of an investigation showed that the NOCC has unregistered branches as certified by the Revenue District Office 052 – Parañaque City, having the jurisdiction over these branches, the tax agency said.
For his part, Sen. Joel Villanueva welcomed the latest closure, but called on the interagency task force to match the BIR’s efforts.
“We credit our finance department for their relentless effort to keep business in check, especially in settling their obligations to the government,” Villanueva said in a separate statement.
“We could only hope that the BIR’s steely determination rubs off on the interagency task force assembled to stem the tide that is the influx of illegal workers,” he added.
The force is led by DoF, and composed of the Foreign Affairs, Trade, Justice and Labor departments; the Philippine Amusement and Gaming Corp.; and the Securities and Exchange Commission.
“Since its organization in May, it [is] yet to mount a single round of joint inspections similar to the BIR’s effort,” the senator said.