The government will make sure that thousands of foreign nationals working in Philippine offshore gaming operations pay their income taxes, the Finance Department said over the weekend.
It said it was working closely with the Bureau of Internal Revenue, the Justice Department, the Labor Department and other agencies to make foreign nationals working in the so-called Pogos comply with the tax laws.
Under Revenue Memorandum Circular No. 78-2018, all foreign and Philippine-based gaming operators, including those with offshore licenses, are required to register with the BIR as a prerequisite in the renewal of their Philippine Amusements and Gaming Corp. licenses.
The directive mandates the BIR to identify and monitor tax payments, including the remittance of taxes withheld on foreign nationals working for them.
Finance Secretary Carlos Dominguez III said the list of foreign nationals working for service providers of Pogo operators should be consolidated and reconciled by the various agencies and offices involved in the screening, providing work permits and registration of foreign workers.
These agencies include the Foreign Affairs Department which screens and issues visas to foreign nationals entering the country; the Justice Department which oversees the Bureau of Immigration that grants short-term special work permits to foreigners; the Labor Department which issues alien employment permits; Pagcor which has a list of licensed Pogo operators; the Trade Department which oversees the special economic zones where several Pogos operate and the Securities and Exchange Commission which registers Pogo agents.
“If we get all that [information], then it is possible that we can begin to collect taxes, enforcing the law on these foreign workers who are operating here. Isn’t that what we really want to do here, enforce the law?” Dominguez said during a recent meeting he requested with the respective heads of these agencies to find ways of making foreign Pogo workers pay their income taxes.
Dominguez said “a good starting point” would be to trace the employers of these foreign workers so that a portion of their salaries could be withheld and turned over to the government as partial payment of their income taxes.
He said that aside from ensuring that foreign nationals comply with tax laws, the government should also find out who and where all foreign workers are, given the national security implications of their large presence in the country.
Other officials who attended the meeting were Justice Secretary Menardo Guevarra, Trade Secretary Ramon Lopez, Labor Secretary Silvestre Bello III, Pagcor chairperson Andrea Domingo, BIR commissioner Caesar Dulay, BIR deputy commissioner Arnel Guballa, SEC deputy commissioner Javey Paul Francisco and deputy solicitor general Henry Angeles.
Guballa said the BIR listed 54 Pogo licensees, of which 10 are local firms and 44 are offshore operators. Of the local operators, only seven are registered, while only eight of the offshore licensees are registered with the BIR.
Citing immigration data, Guevarra said that as of June 2018, less than 95,000 foreign nationals were issued by the BI with various forms of temporary work permits as Pogo employees.
Domingo, however, said this figure was not accurate because foreign workers that were given six-month SWPs might have already secured provisional working permits and remained on the list of those still with SWPs, while those with provisional working permits might have already been issued AEPs by the Labor Department. “The numbers may overlap,” Domingo said.