Government looks into resumption of POGOs

MANILA, Philippines — The government is looking into a proposal to let Philippine offshore gaming operators (POGOs) resume operations to generate funds in the fight against the COVID-19 disease, President Duterte’s chief economic manager said on Monday.

“The evaluation is ongoing,” Finance Secretary Carlos Dominguez III said. “But let me reiterate — all of the above depend on the results of the ongoing evaluation of the trade-offs involved in the decision of maintaining the current partial lockdown or tightening it or loosening it further.”

Dominguez, however, said he was not in favor of lifting the national and local liquor ban being pushed by the alcohol beverage industry.

POGOs and other businesses, except for those involving essential goods and services, have been temporarily closed down amid the lockdown in Luzon and other parts of the country to contain the spread of the disease.

On Sunday, ACT-CIS Rep. Eric Go Yap, chair of the House appropriations committee, called on Philippine Amusement and Gaming Corp. (Pagcor) to allow Pogos to resume their operations for tax purposes.

Gov’t fund depletion

“In view of [exhausted] government coffers, the suspension of POGO operations should be lifted immediately to give our tax collection a much-needed boost,” Yap said in a statement.

He said the country needed all the help it could get now.

“It will not harm us to have additional sources of revenue that we can use for our hungry countrymen. Lives are at stake and we need to act fast,” said Yap, who formerly chaired the House games and amusements committee.

Pagcor said the suspension of Pogo operations was implemented to ensure the safety of all employees and to prevent the further spread of the virus by limiting workers’ movements.

But Yap said there were creative solutions that Pagcor could tap.

Work from home

The state-run gambling regulator should come up with guidelines stipulating dos and don’ts. It should be made clear that work from home should be allowed only if a Pogo is accredited by Pagcor, Yap said.

“I honestly believe that the ECQ won’t be totally lifted by April 30 and there may still be a need for us to support the people next month. Where will we get the fund?” he said.

“We need to find ways to boost the collection of taxes, but it should not be at the expense of public health,” the lawmaker said.

As of early this year, around 60 Pogos had been issued licenses to operate by Pagcor, while 218 service providers employing over 108,000 foreigners had registered with the Bureau of Internal Revenue.

Pogo licensees tap service providers to directly communicate with clients, or online gamblers outside the Philippines, mostly in China.

The government expected to collect P2 billion in taxes from Pogos per month. Last year, it earned P6.42 billion in additional corporate and personal income taxes from its campaign against tax-deficient Pogos.

Tax take down

Dominguez said tax collections in April “will be very bad” partly due to the extended deadlines for filing and paying certain taxes in light of the lockdown extension until April 30.

Over the weekend, the Department of Finance said first-quarter tax collections of the BIR and the Bureau of Customs (BOC) not only declined but also slid below target as the pandemic and the resulting quarantine starting mid-March hurt domestic businesses and external trade.

The country’s two largest revenue agencies collected P600.86 billion in taxes and import duties from January to March, down 1.7 percent from P611.03 billion in the same period last year.

The joint BIR-BOC take as of end-March was 20.6-percent lower than the P757.12-billion goal for the three-month period.

Liquor ban

The Center for Alcohol Research and Development (CARD) Foundation Inc. appealed for the lifting or easing of the liquor ban in an April 16 letter to Trade Secretary Ramon Lopez.

“If this ban continues, the industry can no longer survive; a situation that can affect a large sector of the community,” the group said.

“[T]he alcohol beverage industry bears already the agony of declining market demand due to the imposition of high excise taxes on alcohol,” said CARD, whose members include Absolut Distillers Inc., Emperador Distillers Inc. and Ginebra San Miguel Inc.

—WITH A REPORT FROM DJ YAP