FIRB streamlines POGO license fees

MANILA, Philippines — Philippine offshore gaming operators (POGOs) may soon be allowed to pay the same amount of licensing fees to the government no matter where the economic zone they choose to locate their project.

The Cabinet-level Fiscal Incentives Review Board (FIRB) yesterday said it is studying the possible streamlining of regulatory fees that investment promotion agencies (IPAs) slap on POGOs.

Finance Secretary and FIRB chairman Carlos Dominguez III tasked the FIRB secretariat to look into the option of just imposing the same fees across the board.

Based on records, there are 32 POGO licensees and their service providers registered with the Cagayan Economic Zone Authority (CEZA). Further, there are five POGO service providers with the Clark Development Corp.; three with the Authority of the Freeport Area of Bataan; and one with the Subic Bay Metropolitan Authority.

Finance Assistant Secretary and FIRB secretariat head Juvy Danofrata said the IPAs charge varying fees on POGOs, even though they all fall under the same project type: offshore gaming. She said additional fees collected from other locators would also be evaluated by the FIRB.

“Clearly, there is no uniformity in fees charged by the IPAs to their registered POGO companies, when in fact, they all fall under the same type of project,” Danofrata said.

“The FIRB secretariat has been instructed by Secretary and board chairman Dominguez to look into the inconsistent charges set by IPAs – which most likely do not only apply to the POGOs registered under them – with the end view of streamlining the collection and the use of such fees charged investors or locators,” she said.

At present, the CEZA requires its POGOs to pay $200,000 in application and processing fee for their operating license, and another $500,000 for the master license used for interactive gaming and land-based casinos.

According to Danofrata, IPAs demand regulatory fees ranging from $10,000 to $25,000 for the application, processing, and renewal of online casino and sports betting licenses. Up to $50,000 is also exacted for POGOs’ support services like business process outsourcing and information technology.

Under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, the FIRB can exercise its policymaking and oversight functions on IPAs over the grant of fiscal incentives. In turn, the FIRB may prescribe policies and appropriate fees to be applied given that they form an integral part of the incentive process.

Danofrata said the FIRB can review and rationalize the fees imposed by IPAs against their registered investors based on the CREATE Act.

Tax collections from POGOs declined by nearly 46 percent to P3.91 billion in 2021 from P7.18 billion in 2020, as a number of firms exited the country in search of economies with favorable market conditions.