Govt starts collecting taxes from foreign workers in offshore gaming

The government expects tax collection from foreign workers in the offshore gaming industry to accelerate after they started securing tax identification numbers from the Bureau of Internal Revenue, Finance Secretary Carlos Dominguez III said Thursday.

“We will start collecting [taxes] in July,” Dominguez said, adding that Philippine offshore gaming operators were expected to start withholding income taxes and remit them to the BIR this month.

The Finance Department expects the BIR to collect at least P2 billion a month from registered foreign workers in POGOs. Government data showed that about 138,000 foreign nationals were working for POGOs.

Finance Secretary Carlos Dominguez III
Dominguez said the government would also intensify its campaign targeting unregistered foreign workers to force them to pay income taxes.

“Let’s do this deliberately step-by-step. Whoever is registered should be compliant, then we will look for the unregistered. Let’s not try to solve the whole problem right away.  Let’s solve the ones we have in front of us,” he said.

Dominguez also said the government was only collecting income taxes from foreign workers and not from the POGO operations.

“The way the POGO operates is they pay a fee to Pagcor [Philippine Amusement and Gaming Corp.] in lieu of everything. We are not going after tax for their operation. We are going after the tax they were supposed to withhold from their workers,” he said.

“We know they are tax-free in the Peza [Philippine Economic Zone Authority] zone,” he said.

Finance Undersecretary Antonette Tionko said foreign workers could enjoy lower income tax rate as long as they could prove that they have a legal residence status.

“Obviously, the default is they are non-residents and the burden is on the company to prove that they got the work permits, they have resident certificates. If they can’t show anything, it’s 25-percent tax,” Tionko said.

She also advised foreign workers to complete their personal information when applying for TIN.

“I told them to complete the personal information with date of birth, gender, particularly the spelling of their English names,” Tionko said.

Topics: tax collection , foreign workers , Philippine offshore gaming operators , POGOBureau of Internal Revenue , Finance Secretary Carlos Dominguez III
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