Six Philippine offshore gaming operators remitted P200 million in income taxes withheld from their foreign workers in July, according to the Bureau of Internal Revenue.
BIR deputy commissioner Arnel Guballa said the six offshore gaming operators started remitting the withheld personal income taxes from their foreign workers. Most of these workers are from China.
The BIR official did not identify the six POGO firms and cited the bureau’s duty of confidentiality to the taxpayers.
Guballa said the BIR was expecting collections from POGO workers to further rise in the coming months as the agency intensified its campaign against unregistered foreign nationals.
Finance Secretary Carlos Dominguez III earlier said the BIR continued to process the tax identification numbers of POGO workers seeking to register with the tax bureau.
Dominguez said while the BIR had limitations in delivering the volume of TINs being required by gaming operators, the POGO companies could begin withholding the income tax from their foreign workers.
Finance Undersecretary Antonette Tionko said the BIR’s pace in releasing the POGO TINs was “pretty fast” considering that the tax agency had to manually register the names of foreigners applying with the bureau.
Tionko said the BIR had to be very careful with the spelling because the English translation of many foreign workers’ names, who are mostly Chinese, are similar.
“I told them to complete the personal information with date of birth, gender and everything. They are in the process of getting their TINs, like they issued them around 10,000,” Tionko said.
The finance official said POGO operators could withhold the income tax as long as they would remit the amount to the BIR.
Tiokno said that if POGO operators failed to remit the withheld income tax, “that is worse, the penalty for that is double, and it’s a criminal offense.”
She said that foreign workers could enjoy lower income tax rates as long as they could prove that they have a legal residence status.
“Obviously, the default is they are non-residents and the burden is on the company to prove that they got the work permits, they have resident certificates. If they can’t show anything, it’s 25-percent tax,” Tionko said.
Dominguez said the BIR was collecting only withholding tax, as the POGO operators have certain arrangements with investment promotion bodies and the Philippine Amusement and Gaming Corp.
“The way the POGO operates is they pay a fee to Pagcor in lieu of everything. We are not going after tax for their operation, we are going after the tax they were supposed to withhold from their workers,” he said.
“We know they are tax-free in the Peza [Philippine Economic Zone Aithority] zone,” Dominguez said.
The DOF expects the BIR to collect at least P2 billion a month from the currently registered POGO companies.
Dominguez said the government would run after unregistered POGOs and the BIR, along with other concerned agencies, already identified the legitimate offshore gaming firms in the country.
“Let’s do this deliberately step-by-step. Whoever is registered should be compliant, then we will look for the unregistered. Let’s not try to solve the whole problem right away. Let’s solve the ones we have in front of us,” Dominguez said.