The Philippines’ gaming tax regime puts it at an advantage over some Asian peers and makes the business commercially viable.
This is according to gaming industry consulting firm The Innovation Group tapped by listed PH Resorts Group Holdings Inc. to prepare an industry report for its ongoing follow-on offering.
The Innovation Group said based on the Philippines levy of 15 percent for VIP gross gaming revenues (GGR) and 25 percent for mass gaming revenue, the Philippines “remains commercially competitive within the region.”
This is compared with the 39-percent tax for both VIP GGR and mass gaming in Macau, and 35 percent for both VIP GGR and mass gaming in Malaysia and Vietnam.
This “advantage” allows for a local gaming enterprise to “allocate more resources to customer acquisition or capital improvements” for potentially bigger revenues, The Innovation Group said.
The Philippines’ gaming tax regime, however, is still higher than the 12 percent VIP GGR tax and 22 percent mass gaming GGR in Singapore, the 15 percent tax for both VIP GGR and mass gaming in Korea, as well as the 10 percent tax for VIP GGR and 20 percent tax for mass gaming GGR.
The Innovation Group said the wage rate in the Philippines also offers casinos a competitive advantage relative to other Asian gaming markets.
The average monthly salary of around $700 for dealers in the Philippines is much lower than the $1,750 average salary of dealers in Singapore and Macau.
The gaming consultancy firm said the “relatively easy access” of the Philippines from major population centers in Asia facilitates the position of the country as a popular gaming destination for wealthy neighbors in the region — China, Korea, and Japan.
Revenues in the Philippine gaming industry reached $4.3 billion in 2019 from $800 million in 2010, posting a compounded growth of 20.6 percent.