Finance Secretary Diokno wants POGOs out

Finance Secretary Benjamin Diokno on Thursday said the country should do away with Philippine Offshore Gaming Operators (POGOs), citing what he described as social and reputational risks.

Asked for his personal opinion on POGOs, Diokno told senators the Philippines can move forward without the industry as it has already seen a decline in revenue generation.

At the Development Budget Coordination Committee briefing for senators in connection with the National Expenditure Program for 2023, Diokno said the total revenues from the industry were estimated at P3.9 billion in 2021, versus the P7.2 billion recorded in the previous year.

“If you ask my personal opinion on this, let’s discontinue with the POGO because of the social cost,” he said.

“It also has a reputational risk because people will ask, ‘Why are they going to the Philippines? Diniscontinue na sa China, diniscontinue na sa Cambodia, why are they going to the Philippines?’” he added.

Diokno said that while China and Cambodia have already stopped such operations in their territories, others may deem the Philippines as too “loose” or “not strict” with regards to its rules.

The DOF in September 2019 already threatened to shut down POGOs with tax liabilities, with uncollected withholding income taxes then estimated at P21.62 billion. A number of POGOs have since been closed.

The Finance Department in 2020 said government revenues from POGOs should reach as much as P20 billion per year, but collections only reached P6 billion in 2019.

The Bureau of Internal Revenue (BIR) then said "legal issues" are hampering the collection of franchise taxes from POGOs, who claim they should not be subjected to such taxes as they are non-resident corporations.

For its part, the POGO industry—represented by the Accredited Service Providers Association of PAGCOR (ASPAP)—said its members paid the required regulatory fees and the corporate and withholding taxes of their workers. — RSJ, GMA News