DOF eyes P22B in annual income taxes from Chinese POGO workers

The Department of Finance aims to collect an estimated P22 billion annually in income taxes from Chinese workers employed in the Philippines’ booming online gaming industry.

To this end, an interagency task force formed to monitor the number of foreign nationals employed in Philippine offshore gaming operations (POGOs) is fast-tracking measures to finalize a complete list of these workers with the goal of taxing their wages.

In a meeting presided by Finance Secretary Carlos Dominguez III last week, the members of the group discussed measures to complete the foreign workers’ list after they “discovered gaps or inconsistencies” in the respective figures they had initially submitted to reconcile their records.

The members of the task force agreed to meet again with the Finance chief on March 29 to come up with the complete list.

He said the Philippine Amusement and Gaming Corp., Department of Labor and Employment, the Securities and Exchange Commission, the Department of Justice’s Bureau of Immigration  and the various special economic zones need to come up with a comprehensive list of these foreign workers employed in POGOs.

During the meeting, BIR Deputy Commissioner Arnel Guballa said an initial list of 64 out of 205 service providers of POGOs showed that they employ a total of 33,000 foreign workers or an average of 515 per service provider.

Thus, with 515 foreign workers employed in about 200 service providers, the government should be collecting income taxes from about 103,000 aliens working here, Guballa said.

Guballa said the BIR also came across a newspaper report in China stating that foreign workers in POGOs here receive an average of 10,000 yuan, equivalent to about $1,500 or P78,000 a month.

This yields a total of roughly P22.5 billion a year in foregone income tax revenues.