Chinese online casino worker invasion overwhelms BIR’s TIN process

The sheer number of foreign, mostly Chinese, workers at online casinos or Philippine offshore gaming operators (Pogo) acquiring tax identification numbers (TINs) en masse is overwhelming the Bureau of Internal Revenue’s capacity to issue TINs, prompting the Department of Finance (DOF) to ask the Pogo firms to withhold taxes from their workers’ incomes even without the TINs yet.

The BIR could not issue the TINs fast enough and at such volumes that could meet the large demand.

In an interview, Finance Undersecretary Antonette C. Tionko said so far, the BIR already issued 10,000 TINs to previously unregistered Pogo workers in the cities of Manila, Parañaque and Pasay.

Tionko said there were “limitations” in terms of the volume of TINs that can be issued by the BIR offices which meant that the revenue office could not immediately provide TINs to as many as 130,000 unregistered Pogo workers.

Finance Secretary Carlos G. Dominguez III said “the majority” of foreign Pogo workers do not have TINs yet.

Also, Tionko said the BIR could not speed up the issuance of TINs as the bureau wanted to ensure that Pogo workers’ personal information on registration forms was correct.

Tionko said she had asked the BIR to include space for information such as birthday and gender in the application forms as some Chinese names were similar or sounded alike.

Despite the setback, Dominguez and Tionko said the issuance of TINs will continue until every unregistered Pogo worker gets theirs.

Dominguez also noted that Pogos can already withhold the 25-percent monthly personal income tax from their employees, “but when they remit to the BIR they have to get a TIN.”

Even as most Pogo workers still do not have TINs, their employers must later on remit the taxes they withheld as soon as the TINs were secured, or else they will be slapped a penalty equivalent to 50 percent or double the personal income tax rate for committing a criminal offense, Tionko warned.

Dominguez earlier said the BIR was expected to collect an additional P2 billion in taxes per month as Pogos had committed to religiously pay their dues starting this month.

“We will start collecting in July, but then we will not collect everything from everybody—it will ramp up,” Dominguez said.

“We are not taxing them for their operations—we know they are tax-free in the Peza [Philippine Economic Zone Authority] zones. But that doesn’t excuse them from withholding tax—it’s their obligation to withhold tax from the pay of their workers, that’s the law,” Dominguez said.

Dominguez said Pogos would carry the blame if they were unable to secure TINs for their employees as soon as possible.

“They are complaining, because our system is not set up to register 100,000 a week then all of a sudden you have 100,000… It’s not our fault—they didn’t register! We can’t have a system that’s for registering 100,000 a week. We can’t do it [but] it’s not our fault—they didn’t register [in the beginning], now why is it all of a sudden our fault?” Dominguez said.

On some Pogos’ claim that their workers should pay lower rates because they are already Philippine “residents,” Tionko said: “The default is they are non-residents and the burden is on the company to prove that they got the work permit or they have residency certificates. If they can’t show anything, it’s 25 percent.”/TSB