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BIR collected P7.2 billion from POGOs in 2020

THE Bureau of Internal Revenue (BIR) collected P7.18 billion in taxes from Philippine Offshore Gaming Operators (POGOs) last year, even as some offshore companies reportedly left due to the tighter tax rules.

In a statement, BIR Commissioner Caesar R. Dulay said taxes from POGOs were 12% higher than the collection in 2019, although he did not provide the exact figure.

In 2018, the BIR collected P2.8 billion in taxes from POGOs.

BIR Deputy Commissioner for Operations Arnel SD. Guballa attributed the higher POGO tax collections last year compared with 2019 to the additional revenues generated through the 5% franchise tax.

“The increase in tax collection in taxable year 2020 over 2019 is primarily due to the compliance in the payment of franchise tax by some POGO Licensees, which was made a prerequisite for the issuance of a BIR clearance to allow them to resume partial operations during the ECQ (enhanced community quarantine) periods,” Mr. Guballa said in a text message on Tuesday.

The government began its campaign against tax-dodging POGOs and their service providers in 2019. It set deadlines for POGOs to secure Tax Identification Numbers (TINs) for their employees and remit withholding taxes.

In 2020, the BIR started collecting a 5% franchise tax after Republic Act 11494 or the Bayanihan to Recover as One Act (Bayanihan II) changed the basis of the tax rate to gross bets amid alleged cheating when computing their net winnings.

Earlier this month, the Supreme Court issued a temporary restraining order (TRO) against the BIR, preventing it from collecting the franchise tax after 14 licensed POGOs questioned the new tax.

The BIR’s total collections reached P1.94 trillion last year, down 11% year on year but 15% higher than the P1.69-trillion revised target.

“It’s the first time that BIR went above its goal by 15%. The last time the BIR hit its goal was in 2001 and 2003, that was 17 years ago,” said Mr. Dulay in the statement. — B.M.Laforga

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