Good and bad eggs

HIDDEN AGENDA - Mary Ann LL. Reyes (The Philippine Star) - May 10, 2020 - 12:00am

Reactions were mixed when the government’s COVID-19 task force allowed Philippine offshore gaming operators or POGOs to resume partial operations.

There are two reasons being cited by government to allowing POGOs to resume operations, albeit with a skeleton workforce. First is that revenues from POGOs can be a significant source of funds for the government’s response to the pandemic. Second is that since POGOs are business processing outsourcing or BPO companies, then they should be allowed to operate since BPOs are among those industries permitted to resume work even under an extreme community quarantine.

But Malacanang has clarified that only POGOs that have registered with the Bureau of Internal Revenue and have paid their taxes as of March 20 will be allowed to operate once again.

There are those who are not happy about government’s decision however, citing instances of non-payment of taxes, corruption, money laundering, and even sex and human trafficking committed by some POGOs.

There are about 60 POGOs licensed by the Philippine Amusement and Gaming Corp. or PAGCOR, of which 50 are online casino operators based abroad and 10 are Philippine-based. Last year, the Department of Finance was able to collect P6.42 billion in taxes from POGOs and their service providers. And according to PAGCOR, the suspension of POGO operations following the quarantine deprived the agency of as much as P600 million in monthly revenue from regulatory and licensed fees.

Admittedly, however, there are illegitimate POGO operators and there are legitimate ones, in particular some foreign-based operators, who do not pay the five percent franchise tax because they are outside Philippine jurisdiction, a position supported by Solicitor General Jose Calida who earlier said that these foreign-based POGOs cannot be taxed  because offshore operations are considered outside the Philippines.

But then, there are legitimate ones who do not want to be lumped together with the undesirables.

The Accredited Service Providers of PAGCOR (ASPAP) earlier expressed its support to the authorities in their crackdown against illegal gambling following arrests in Makati and Paranaque of those allegedly involved in illicit offshore gaming operations.

The group emphasized that it does not condone, abet, or tolerate any form of these illegal operations, adding that the existence of the latter prejudices the interests of legitimate POGO operators subjecting, the legitimate ones to unfair criticisms.

ASPAP likewise voiced its support for congressional initiatives to improve regulatory processes and eliminate illegal gambling. Rep. Joseph Bernos, who chairs the House committee on games and amusements, earlier called for greater vetting of online operators and control of non-registered offshore gaming operators.

Sen. Risa Hontiveros, meanwhile, filed a resolution seeking to disallow the resumption of POGO operations in the country, saying it is a high-risk sector that should be considered as a non-essential industry.

The group stressed that it welcomes the opportunity to clear the concerns raised on the partial resumption of POGO operations during the ECQ and to shed light on the myths surrounding this largely misunderstood activity.

Clearly, there are legitimate POGO operators who secure all the necessary licenses and permits from a number of government agencies.

The Bureau of Internal Revenue requires all POGO operators, whether Philippine or foreign, to register with local tax authorities before they can secure a certification of accreditation from PAGCOR and start operating. 

PAGCOR meanwhile requires all POGO employees to secure an offshore gaming employment license (OGEL). Foreign employees applying for OGEL must present, among others, a photocopy of a valid passport from his country of origin and a valid work visa or permit. If a POGO deploys an employee who does not have a valid OGEL, or endorses the OGEL application of an ineligible applicant, then such operator faces possible cancellation of its offshore gaming license.  

Also, legitimate POGOs are required to register with the Anti-Money Laundering Council. 

No less than President Duterte has said that he will not suspend or shut down POGO operations in the country despite allegations of crimes and illegal activities related to the industry, adding that government needs the revenues from the POGOs to bankroll government programs.

However, government should not close its eyes to the alleged existence of bad eggs in the industry. Just like any industry, there are good and rotten eggs, and measures have to be taken to avoid spoiling the entire basket.

In the meantime, the legitimate ones, in particular those have been paying what is due the government in terms of taxes and fees, should be allowed to resume operations because after all, our country needs all the help it can get to help our economy get back on track.

For comments, e-mail at mareyes@philstarmedia.com

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