Amid rising concerns over online gambling, one of the country's top economic officials proposed leveraging e-wallets as a tool for taxation.

As President Marcos’ economic managers have yet to finalize their collective stance, Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio M. Balisacan proposed exploring digital transactions in online gambling as a possible new revenue source for the government.

“My understanding is that most participants in online gambling use e-wallets such as Gcash,” Balisacan told reporters on Wednesday, July 8. “So that might be an appropriate vehicle for catching it in terms of taxes.”

Balisacan’s proposal comes amid increasing calls for stricter regulation and oversight of the online gaming sector, which has seen significant growth in recent years.

Balisacan said that he and other economic officials are still deliberating on online gambling and related concerns, while recognizing its increasing prevalence and spread among Filipinos.

“The reality is that it’s there, but you need to tax,” Balisacan said. “I think, at the very least, you can tax it. You can treat it like cigarettes—impose taxes, but at the same time, make sure it doesn't become a social menace, just like POGOs [Philippine offshore gaming operators].”

Last year, POGOs were banned from operating in the Philippines primarily because they were linked to criminal activities. It caused an increase in “crime rates, social instability, and exploitation of vulnerable people associated with them.”

POGOs have been flagged as vulnerable to money laundering, fraud, and other illegal financial activities, posing significant risks to the country’s financial system.

“Gambling is a social issue, but we need to regulate it effectively, just like we regulate smoking and sugar. It affects [health],” Balisacan said, adding that “it has to be a government decision and a policy too.”

After the banning of POGOs, online gambling has since proliferated to a “concerning” extent. As such, the government, Balisacan said, will eventually take a stance as to whether or not online gambling will be banned, as it is “becoming a concern.”

He noted that there is still a need to determine whether new legislation is required to effectively tax online gambling activities.

Balisacan concluded that regulating online gambling is a “challenge” considering its swift evolution alongside AI and other technologies.

To recall, the government had suspended all electronic sabong (e-sabong) operations in 2022. After which, the Bangko Sentral ng Pilipinas also ordered e-wallets and other supervised institutions to remove links to e-sabong from their platforms.

Last week, the BSP announced the plan to issue a new circular that will require banks and electronic money issuers to enhance their protective measures to protect digital users from growing online gambling risks.