THE Senate ways and mean committee will push for the termination of all Philippine Offshore Gaming Operations (POGOs) in the country because their social costs outweigh the economic benefits that the government is getting from them, Sen. Sherwin Gatchalian yesterday said.
Gatchalian told dzBB radio that his committee has already completed its recommendations and will start routing its report for the signature of the panel members.
“May dahilan ho kami talaga, hindi lang base sa naririnig kundi may ebidensiya (We have reasons [to recommend the end of POGOs] based not only on what people says but through evidence,” Gatchalian said.
He said his committee’s position to shut down the POGO industry is shared by the Department of Finance (DOF).
“Siguro isa sa pinakamalakas ang boses pagdating (sa pagkontra) dito sa POGO ay ang DOF, Department of Finance. Nung una pa man, nung first hearing, talagang napaka-determinado (na ng DOF) na i-ban ang POGO dahil nakikita nila ang epekto nito sa investments natin (One of the agencies has been loudly opposing these POGOs is the DOF.
It has been pushing for the ban on POGOs since the committee started its hearings because of its [POGOs’] effects on the country’s investments),” Gatchalian said.
Aside from the DOF, the National Economic and Development Authority (NEDA) has also aired its doubts on the economic benefits of POGOs.
Gatchalian said he will discuss his committee’s findings with President Marcos, who said during an interview in Zurich on Friday that his administration has yet to make a final assessment of the pros and cons of allowing POGOs to operate in the country.
The President has said he is still evaluating if the offshore gaming industry is still good for the country amid reports of crimes committed by its foreign workers.
At the same time, he also said that only illegal POGOs are the problem because its workers are usually the ones involved in kidnapping, murder, human trafficking, and extortion, among others.
In a committee hearing held October last year, Ronelyn Jaectin of the DOF revenue operations groups, said POGO operations bring more risks to the country even if it contributes to government revenues.
“Social costs are inherently difficult to quantify, particularly those that go beyond direct victims and heightened social fear. What is clear, though, is that these social costs affect investor perception and consequently foreign direct investment decisions,” Jaectin said.
While the closure of POGOs will have a “short term” impact on the economy, Gatchalian said it will eventually recover “dahil hindi na matatakot ang investors at mga tourists na pumunta sa atin (because investors and tourists will no longer be afraid of going to our country).”
TAX EVADERS
Gatchalian, in previous Senate hearings, has repeatedly said that aside from crimes committed by foreign POGO workers, offshore gaming industry players have also been remiss in paying the correct taxes, as shown in documents submitted by the Bureau of Internal Revenue (BIR) and the Philippine Amusement and Gaming Corporation (Pagcor).
Saying that the government could have collected more taxes from legitimate POGO operators if they have been more honest in their transactions with the government, Gatchalian noted a “tax leakage” of around P1.9 billion in the difference of gross gaming revenues as reported by the BIR and Pagcor from January to August 2022.
Gatchalian said he has called for another hearing today (Monday) to get additional information on the decision of the Pagcor to hire a third-party auditor and find out the correct income taxes that foreign POGO workers should be paying to the government.
“Nung nire-review naming ang committee report at binangga namin sa batas, marami kaming nakitang mga katanungan at ito ay particular sa third-party auditor. At gusto namin marinig sa Pagcor at sa third-party auditor at sa iba pang resource persons natin ‘yung mga issues patungkol dito (When we were reviewing the committee report and compared it with existing laws, we found out that there are still a lot of unanswered questions, particularly on the third-party auditor. We want Pagcor and the third-party auditor, and other resource persons to clarify certain issues),” he said.
