Pagcor License Fees
POGO In The Philippines
The Philippine Offshore GamingOperations (POGO) has been a major contributor to the Philippine economy sinceits entry to the country sometime in 2003. Since then, more and more foreigncompanies and entities are entering the Philippines to get a slice of thelucrative offshore gaming market. As the number of POGOs increase, regulatingthem has been a problem, thus, the Philippine government has tasked thePhilippine Amusement and Gaming Corporation (PAGCOR) with the mainresponsibility of regulating and the registration of POGOs. There are alsoother regional gambling regulators which the Philippine government allows toissue offshore gaming licenses like Cagayan Economic Zone Authority(CEZA), Aurora Pacific Economic Zone & Freeport Authority (APECO), andAuthority of the Freeport Area of Bataan (AFAB).
Pagcor revises monthly POGO license fees. AGB WebTeam - May 30, 2017. Share on Facebook. Tweet on Twitter. Tweet; Under a revised scheme announced on May 25, POGO licensees offering RNG games will be required to pay a percentage of gross gaming revenue, rather than the previous staggered flat-rate., Calvin Ayre reports. We would like to show you a description here but the site won’t allow us.
In this article, you will learn about the different classifications of POGOs, their applications processes and the taxes that they are subjected to in the Philippines.
TWO (2) DIFFERENT CLASSIFICATIONS OF POGO OPERATORS
- Philippine-based Operator – Philippine-based Operator refers to a duly constituted business corporation organized in the Philippines who will either conduct offshore gaming operations themselves or engage the services of PAGCOR-accredited service providers
- A Foreign-based Operator refers to a duly constituted business corporation organized in any foreign country who will engage the services of a PAGCOR-accredited local gaming agent and service providers for its offshore gaming operations.
WHAT IS THE PROCESS FLOW FOR APPLICATIONS FOR PHILIPPINE-BASED OPERATOR?
- Submissionof Letter of Intent addressed to the PAGCOR Chairman and CEO.
- AcknowledgesLetter of Intent and initial evaluation of applications
- Issuance of Deposit Notice and Payment Form forpayment of application and processing fee
- Uponpayment, Applicant MUST submit copy of proof of payment of the application andprocessing fees and secure clearance from FOCAS-OGLD
- Uponreceipt of the proof of payment, LD-OGLD will issue a pre-numbered applicationkit and table of checklist of documentary requirements
- Submissionof complete documentary requirements (MUST be accomplished within 3 months fromissuance of a pre-numbered application kit)
- Finalreview, recommendation and endorsement of applications to the AVP, OGLD
- BoardApproval
- Noticeof Approval to the applicant
- Paymentof License Fee/s, Performance Bond Fee and Permit to Possess Fee
- Issuanceof License to Philippine-based Operator
WHAT IS THE OFFSHORE GAMING LICENSE?
An Offshore Gaming License (OGL)is an authority granted by PAGCOR to Philippine Offshore Gaming Operators forthe establishment, maintenance and the conduct of offshore gaming operations ina specific site within the jurisdiction of PAGCOR.
No operator shall be allowed to conduct offshore gaming operations without a valid OGL evidenced by a certificate issued by the OGLD
Pagcor License Fees Renewal
WHAT ARE THE THREE (3) TYPES OF OFFSHORE GAMING LICENSES?
Pagcor License Fees Waiver
A. E-casino – refers to an OGL for the operation of Live CasinoGames or Random Number Generator (RNG) based games.
B. Sportsbetting – refers to an OGL for the acceptance and/orfacilitation of wagers in the operation of predicting the outcome and resultsof a sporting event.
C. Sportsbetting on Regulated Wagering Events
WHAT ARE THE TAXES THAT POGOs ARE SUBJECTED TO?
Like any other person or entity doing business in the Philippines, POGOs are subjected to Philippine taxes. Pursuant Bureau of Internal Revenue (BIR) Revenue Memorandum Circular No. 102-2017 POGOs are subjected to the following taxes:
- INCOMETAX –
- Incomefrom Gaming Operations, which refer to income or earning realized orderived from operating of gambling casinos, gambling clubs and other similarrecreation and amusement places and gambling pools.
- Incomefrom Other Related Services, which refers to income or earning realized orderived not from gaming operations but from such other necessary and relatedservices, shows and entertainment.
- VALUE-ADDEDTAX
- Income from Other Related Services from non-gaming operations shall be subject to normal income tax, value-added tax, and other applicable taxes, as may be deemed appropriate.
- FRANCHISETAX
- The entire gross gaming receipts/earnings or the agreed or pre-determined minimum monthly revenues/income from Gaming Operations under existing rules, whichever is higher, shall be subject to a franchise tax of five percent (5%), in lieu of all kinds taxes, levies, fees or assessments of any kind, nature or description, This income is therefore exempt from any kind of tax, income or otherwise, as well as fees, charges or levies of whatever nature, whether national or local.
- A Licensee deriving income from both gamingoperations and from other related services shall be subjected to 5% franchise tax on its gaming revenues and normalincome tax, value-added tax and other applicable taxes on its non-gamingrevenues.
- An Other Entity, specifically including thegaming agent, Service Provider and Gaming Support Provider who is also a POGOLicensee shall be taxed 5% Franchise tax on its gaming activities and subjectto normal tax rate and other appropriate taxes on its non-gaming operations.
- WITHHOLDINGTAXES
- Income payments made by POGO Licensees or any other business entity licensed or authorized by PAGCOR for all their purchases of goods and services shall be subject to withholding taxes as may be appropriate and applicable.
- Compensation, fees, and commissions or any other form of remuneration as a result of services rendered to POGO Licensees or any other business entity licensed by PAGCOR shall be subject to applicable withholding taxes under existing revenue laws and regulations.
Written by: Atty. Jon Dominic Peñaranda
Despite higher gaming income, state-run Philippine Amusement and Gaming Corporation (Pagcor) said its revenues fell last year due to lower license fees.
In its financial statement posted on its website, Pagcor's revenues dropped 1.3% to P39.99 billion last year, way below the P45.47 billion target for the year.
Its gaming income, which accounts for more than half of its annual revenues, rose 8.5 percent to P29.93 billion last year. Meanwhile, its other related services, including license fees, declined 28 percent year-on-year to P8.56 billion.
In May last year, Pagcor temporarily lowered the license fees to be paid by gambling casinos at Entertainment City in Paranaque after the Bureau of Internal Revenue (BIR) slapped a 30-percent income tax on gambling casinos.
Pagcor License Fees
Pagcor's license fees were reduced to 5 percent from 15 percent of gross gaming revenues from high roller tables as well as junket operations and 15 percent from 25 percent on gross gaming revenues from non-high roller tables, slot machines and electronic gaming machines.
Meanwhile, Pagcor is expected to raise additional revenues this year after the Supreme Court ruled in February that its income derived from gaming are exempted from corporate income tax.
Maricar L. Bautista, Pagcor assistant vice-president for Corporate Communications, said the high court's decision only affirmed their position that the imposition of 30 percent corporate income tax on gaming revenues is illegal.
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