Additionally, ensure ongoing compliance with regulations and risk management practices to establish a successful and sustainable online gaming business in the Philippines. Taguig City – Philippine Economic Zone Authority (PEZA) Director General Charito “Ching” Plaza on Sunday emphasized that PEZA does not register online gambling as it is not part of the law governing the investment promotion agency’s (IPA) mandate. However, she supports government efforts to raise income through Philippine Offshore Gaming Operators (POGOs). The Philippines presents a lucrative opportunity for entrepreneurs and investors looking to enter the online gaming industry. The Philippines offers a wealth of opportunities for those looking to start an online gaming business. Developing a comprehensive marketing strategy is crucial to attract players and build a strong brand presence in the competitive online gaming market.

POGOs: Stay or go?

PAGCOR’s Contractees’ revenue derived from their contract with PAGCOR in connection with the latter’s gaming operations shall be exempt from regular CIT upon payment of the 5% franchise tax. However, for VAT purposes, the goods they provided to and/or services they performed for PAGCOR in relation to such gaming operations are subject to 0% VAT. PAGCOR’s income from its operation and licensing of gambling casinos, gaming clubs and other similar recreation or amusement places, and gaming pools are subject to 5% franchise tax in lieu of all taxes. For VAT purposes, the sale of goods and/or services in the course of trade or business is generally subject to VAT.

Key Steps to Success in the Philippine Online Gaming Market

The online gaming industry is highly regulated, and it is crucial to ensure ongoing compliance with Philippine laws and regulations. The license to operate online gambling granted to qualified operators shall not be assigned, shared, leased, transferred, sold or encumbered to any other party. Any gambling operator desiring to operate outside the jurisdiction of the government authority whicch issued its existrng license shall apply for a separate license with the appropriate authority. PAGCOR’s Licensees’ income from the operation of casinos shall be exempt from regular CIT upon payment of the 5% franchise tax since the law is clear that said exemption inures and extends to their benefits. The 5% franchise tax shall be in lieu of other direct and indirect taxes like income tax and value-added tax (VAT). In short, PAGCOR is exempted from corporate income tax (CIT), VAT, and other direct or indirect taxes.

• The Philippines is a gaming hub in Southeast Asia, with a growing online gaming market and a thriving casino industry.
• The online gaming industry is highly regulated, and it is crucial to ensure ongoing compliance with Philippine laws and regulations.
• This blog post will provide a step-by-step guide on how to start an online gaming business in the Philippines, covering everything from understanding the market to obtaining the necessary licenses and ensuring compliance with regulations.

PAGCOR tax treatment

With a booming gaming market and a supportive regulatory environment, the Philippines has become an attractive destination for investors and entrepreneurs looking to start an online gaming business. “While PEZA is the highest  contributor to export income to the country through its economic zones program and its export enterprises engaged in IT/BPO services as the biggest job  provider; however, the agency does not include the registration of online gambling as it is not among those export-services provided in the PEZA law,” said Plaza. With a growing gaming market, a young and tech-savvy population, and a supportive regulatory environment, the country offers a favorable climate for online gaming businesses.

For a PAGCOR Licensee enjoying an ITH, such income is exempt from corporate income tax, but is subject to VAT. Finally, if a PAGCOR Licensee’s other related operations/services or non-gaming operations are not covered by its registered activity, such income is subject to regular corporate income tax, VAT, and other applicable taxes. PAGCOR’s income from its franchise/gaming operations is subject to 5% franchise tax, in lieu of all taxes, including value-added tax (VAT). Conversely, income from related operations/services or from non-gaming operations is subject to the regular corporate income tax, VAT and other 20 deposit casino applicable taxes.

Repeal.�All executive orders, rules and regulations and other issuances or parts thereof which are inconsistent with this Executive Order, are hereby revoked, amended, or modified accordingly. Let’s Talk Tax is a weekly newspaper column of P&A Grant Thornton that aims to keep the public informed of various developments in taxation. Apart from its mandatory contributions to various agencies and entities, PAGCOR has also been undertaking major Corporate Social Responsibility projects under the leadership of its present management.