For online operators in the Philippines, one of the sticking points about their tax obligations has been a disagreement over exactly what they owe, beyond their licensing fees. The previously non-committal Philippines Amusement and Gaming Corporation (PAGCOR) has now firmly chosen a side, telling operators to pay 5% of their revenues or leave.

In a memo sent to operators which CalvinAyre has obtained, PAGCOR Assistant Vice President Jose Tria Jr. tells operators they must pay the 5% tax recently passed by the Philippines Congress under the Bayanihan to Recover as One Act, or they will be shut down. Specifically, they must pay:

“(f)Amounts derived from the five percent (5%) franchise tax on the gross bets or turnover or the agreed pre-determined minimum monthly revenues from gaming operations, whichever is higher, earned by offshore gaming licensees, including gaming operators, gaming agent, service providers, and gaming support providers;

“(g) Income Tax, VAT, and other applicable taxes on income from nongaming operations earned by offshore gaming licensees, operators, agents, service providers and support providers.”