BIR warns POGO service providers to follow tax laws

MANILA, Philippines — The Bureau of Internal Revenue (BIR) once again warned delinquent service providers of Philippine offshore gaming operators (POGO) to comply with tax laws and settle their obligations to avoid closure.

According to Internal Revenue Commissioner Caesar Dulay, there are still some POGO service providers who are ignoring the BIR’s warnings despite being issued with demand letters and notices.

“Tell them to cooperate and volunteer to pay. The problem is they don’t respond to our demand letters,” Dulay said.

The BIR, together with the POGO task force, is intensifying its crackdown against unregistered POGOs and their service providers, as well as those who do not withhold and remit the proper taxes to the government.

Just last Sept. 25, authorities from the BIR and the Quezon City police served a closure order against Great Empire Gaming and Amusement Corp. in its offices in Quezon City, Paranaque City, and Subic in Zambales.

According to the BIR, the POGO service provider was not registered with the bureau for value added tax (VAT) purposes, in violation of Section 108 vis-a-vis Section 115 of the National Internal Revenue Code of 1997.

However, the BIR lifted the closure order last Sept. 27, after the company committed to settle P1.3 billion in tax liabilities in tranches.

Dulay said the first payment worth P250 million was already made, while the remaining balance would be paid through postdated checks until December.

BIR deputy commissioner Arnel Guballa earlier said the operation marked the start of the BIR’s enforcement activities against unregistered POGO service providers.

Currently, there are about 248 service providers licensed by the Philippine Amusement and Gaming Corp. (PAGCOR). However, Guballa said about 100 of these are still not registered with the BIR.

PAGCOR chairman and chief executive officer Andrea Domingo also said the agency would back the BIR in its bid to intensify the crackdown against erring POGOs and their service providers, adding that BIR has the legal authority to close down establishments who evade taxes.

“PAGCOR supports this move. We are issuing a letter to all POGO operators and service providers to this effect,” Domingo said.

She said PAGCOR also has measures in place to ensure that offshore gaming firms would be held accountable should they fail to pay their obligations to the government.

The gaming regulator also imposed a moratorium on the issuance of licenses to offshore gaming firms seeking entry in the Philippines until such time it addresses all issues plaguing the industry.