BIR warns delinquent POGOs anew
The Bureau of Internal Revenue (BIR) said that service providers for Philippine offshore gaming operators (POGO) must cooperate and comply with the tax authorities to avoid revenue losses once they become subject for closure.
BIR Commissioner Caesar R. Dulay said that POGO service providers should be prepared to incur millions of losses if they will keep snubbing the bureau’s demand letters regarding their outstanding tax liabilities with the government.
“Tell them to cooperate and volunteer to pay. The problem is they don’t respond to our demand letters,” Dulay said, hinting there were still POGO service providers that remain non-compliant with the tax laws and regulations despite government crackdown.
Last week, a “tax-dodging” offshore gaming service provider entered into a P1.3-billion settlement agreement with the BIR less than a week after the bureau shuttered its operations in Quezon City, Paranaque, and Zambales.
Dulay said that Great Empire Gaming and Amusement Corp. (GEGAC) paid an initial P250 million for the lifting of the BIR closure order because “they cannot afford to be closed for long.”
For the remaining P1.05-billion balance, GEGAC issued three postdated checks payable until the end of this year, the government’s chief taxman said.
The BIR, following the instruction of the Department of Finance (DOF), has formed a task force to run after those unregistered POGO service providers that do not pay taxes, particularly the income tax of their foreign employees.
To date, there are about 248 POGO service providers licensed by the Philippine Amusement and Gaming Corp. (Pagcor). Under BIR rules, these companies have to remit withholding taxes from their workers on the 10th day after the end of the previous month.
Andrea D. Domingo, Pagcor chair and chief executive said that they are with the tax authorities in cracking the whip on POGOs that fail or refuse to pay their tax dues.
“We follow the law. The BIR has the legal authority to close down establishments that evade taxes,” Domingo said after Finance Secretary Carlos G. Domingos III ordered the closure of tax-delinquent POGOs. “Pagcor supports this move,” she added.
Domingo also said that Pagcor issued a letter to all POGO companies and service providers reminding them to follow the country’s tax law being implemented by the BIR.
She also said that Pagcor has its own measures to hold POGO licensees accountable should they renege on their financial obligation.
Among these measures were the imposition of interest on outstanding arrears, forfeiture of performance bond, imposition of demerits/administrative sanctions and charging of cash penalty, cancellation of license and endorsement to legal division for proper collection efforts.
The Pagcor chief also reiterated that the moratorium on the issuance of new POGO licenses continues to take effect.