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House to adopt Senate version of POGO tax bill, Salceda says

The House of Representatives will adopt the Senate’s version of the proposed measure taxing Philippine Offshore Gaming Operators (POGO), a key lawmaker said on Friday. 

“The House leadership, at my recommendation, will adopt the POGO tax regime approved by the Senate,” Albay Rep. and House Ways and Means Chair Jose Maria Clemente S. Salceda said in a statement.  

This means the bill, which was certified as urgent by President R. Duterte, will be no longer be reviewed by a bicameral conference committee. The Senate version of the bill can be sent to Malacañang after Congress opens its third and last regular session on July 26.  

Mr. Salceda sent a letter House Speaker Lord Alan Q. Velasco on July 19 where he recommended the adoption of the Senate version of the POGO tax bill. 

“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,” he said. 

Mr. Salceda noted the Senate’s version only contains “minor reworkings” of the House bill, and does not have any differences in tax rates and tax bases.  

“POGO taxes will raise P13.4 billion in its first year, and P176.9 billion in five years,” the lawmaker said. 

Both versions impose a 5% tax on gross gaming receipts for offshore gaming licensees (OGLs) and a 25% tax on gross income for nonresident aliens working for POGO service providers. 

“The Senate version slightly differs in style, imposing a minimum monthly tax of P12,500, which would have the same revenue consequence,” Mr. Salceda said. The House version required taxes for POGO employees to be remitted on a quarterly basis or in advance but with a refund mechanism in place in case of excess taxes. 

The Senate version also requires every alien employee of POGOs to have a Tax Identification Number (TIN), imposing a P20,000 fine for each one that does not have a TIN.  

Mr. Salceda said under the Senate version, “non-gaming income is to be taxed at 25% of taxable income, akin to regular corporations.” 

He said the Senate version also “removes the provision that offshore gaming licenses 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.” 

Also, the Senate version prevents the Aurora Pacific Economic Zone and Freeport from issuing new POGOs licenses. It also transfers the regulation of POGOs currently registered in the economic zone to the Philippine Amusement and Gaming Corporation. 

“On top of the tax provisions, we also instituted stringent measures to monitor their personnel, supervise their operations, and punish them for violations of the law. By making POGO taxes a part of the Tax Code, they become subject to all the applicable penalties in the Code, including tax evasion,” Mr. Salceda said. — Kyle Aristophere T. Atienza  

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