Lower House to adopt Senate version of POGO tax measure

Published July 23, 2021, 3:38 PM

by Ben Rosario


Its final, the House of Representatives will adopt the Senate version of the Philippine Offshore Gaming Operations (POGO) tax bill as congressmen underscored the need to immediately raise P13.4 billion from POGO operators to further boost government’s financial capability in fighting the COVID 19 pandemic.

Albay Rep. Joey Sarte-Salceda, chairman of the House Committee on Ways and Means, said the House leadership under Speaker Lord Allan Velasco has vowed to adopt the POGO tax regime of the Upper House.

Salceda strongly recommended the House action as he noted that POGO taxes will guarantee government additional P176.9 billion income in five years.

“Both versions impose a 5% tax on gross gaming receipts for “offshore gaming licensees” and a 25% tax on gross income for nonresident aliens working under the Service Providers of these licensees,’ said Salceda, referring to the nearly identical versions of the two legislative chambers.

“Secretary Dominguez is right. The House leadership, at my recommendation, will adopt the POGO tax regime approved by the Senate,” said Salceda.

Adoption of the Senate version by the Lower House will no longer require Congress to convene a bicameral conference committee which, at times, result to the insertion of riders or amendments that veer away from the original intention of a legislative proposal.

Salceda pointed out that the Senate version “contains only minor reworkings of the House version, and there is no difference between their tax rates and tax bases, and those of the House version. “ “We were the first draft, and they made very few modifications. So, recognizing the respect that the Senate extended to the House version, we will adopt their changes, which in my view are acceptable,” the veteran administration lawmaker pointed out.

The POGO tax bill has been certified by President Duterte as urgent administration measure.

Five provisions contained in the Senate version that congressmen found to be “non-contentious” are: 1. Requirement on every alien employee of offshore gaming licensees (OGL) commonly known as POGO to secure a Tax Identification Number (TIN); 2. Removal of the provision that POGOs currently registered with other special economic zones will pay at their current tax rate or 5% of gross gaming revenues, whichever is higher, and instead makes the 5% rate uniform. This is of little consequence if compared to the House version.

3. Granting the Philippine Amusement and Gaming Corporation the sole authority to issue new POGOs licenses and regulate their operations 4. No specific provision that specifically imposes that the income reported by POGO employees for tax purposes can be used as a basis for the computation of other mandatory contributions.

5. The taxable period for the Senate version, for both POGO taxes and employee taxes, is monthly.