Internal Revenue Bureau, Finance Dep’t shut down gaming operator for alleged tax evasion

Bureau of Internal Revenue. <i>Photo: ABS-CBN News</i>
Bureau of Internal Revenue. Photo: ABS-CBN News

Philippine offshore gaming operator (POGO) New Oriental Club88 Corporation, the largest of its kind in the country, was shut down yesterday by the Department of Finance and the Bureau of Internal Revenue (BIR) for allegedly failing to pay its taxes.

The government closed its offices in Parañaque City, specifically those located in the Icon Hotel on Diosdado Macapagal Boulevard, the Pearl Residences and Sky View Tower on Quirino Avenue, and inside the Burgundy Tower on Pacific Drive, CNN Philippines reported. While its Makati City office was registered with the BIR, the ones in Parañaque City are not.

The BIR estimated that the POGO’s unpaid taxes could be worth “billions” of pesos.

A POGO is a company that offers online gaming services to foreign clients, most of whom are Chinese. Many of them opened in key cities in the country after President Rodrigo Duterte came into power, in part because of his government’s warm relationship with Beijing. Earlier this month, the Office of the Solicitor General had said the operators shouldn’t be required to pay taxes to the government only to later backtrack, telling the Finance Department that POGOs could be taxed if their income is derived within the Philippines.

According to government records, New Oriental employed 6,700 Chinese nationals, but BIR Deputy Commissioner Arnel Guballa said that the number could be as high as 18,000, GMA News reports. Meanwhile, only some 50 Filipinos are employed by the company as drivers, cooks, and cleaners.

Finance Secretary Carlos Dominguez III said in a statement released yesterday that they have temporarily closed down at least three POGOs since September because of their alleged failure to pay taxes. He added that the government has since collected PHP1.2 billion (US$23.628 million) in taxes from one of these POGOs, and that it was unfair to Filipinos who dutifully pay their taxes for these POGOs to continue with their “tax-dodging practices.”

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