Pagcor to take legal action vs 33 Pogos

THE Philippine Amusement and Gaming Corp. (Pagcor) is taking legal action against 33 offshore gaming licensees, including some who have left the country, for unpaid fees amounting to P2.02 billion, Pagcor chairman and CEO Alejandro H. Tengco announced in a statement issued last Thursday.

Pagcor’s statement read that its “records show that the operators, who were given licenses during the previous administration, have not paid their license fees for over a year now in violation of Section 4.C of the Offshore Gaming Regulatory Manual.”

Tengco was quoted in the statement as saying that “despite appeals by the current management, the offshore gaming operators in question have not remitted regulatory fees due to Pagcor.”

“Because of this situation, we are duty-bound to take a legal course of action. We are now in the process of gathering pertinent information to file appropriate cases against them,” he added. Pagcor said that of the 33 erring offshore gaming operators, two were billed as of May, while two others were endorsed to Pagcor’s Legal Group in February.

“Also, while five of the operators already closed shop, Tengco warned that their refusal to abide by Philip- pine laws and to pay the government what is due shall be dealt with legally,” the statement read. rules that have started to take away tax incentives and other fiscal perks.”

“Pagcor will continue to ensure that all our regulated gaming entities—including offshore gaming operators and service providers—will abide by our regulatory policies, including proper payment of fees and taxes,” Tengco said through the statement.

During a congressional hearing early this week, the Pagcor chief said some offshore gaming operators who were granted licenses during the previous administration closed shop during the pandemic, leaving behind billions of pesos in unpaid dues.

“We appeal in the strongest terms for the government to cure the situation by ordering the review and amendment of the IRR and the immediate suspension of [Revenue Regulation] RR-21-2021, [Revenue Memorandum Circular] RMC 242022 in order to preserve the original intent of the Create Act,” the Joint Resolution states.

CILA said the Create law (Republic Act 11534), signed on February 3, 2021 is meant to lower the corporate income tax rate, rationalize and streamline fiscal incentives.

Moreover, it said, the law has a socalled sunset provision that allows registered enterprises to continue enjoying the 5 percent tax on Gross Income Earned (GIE) up to 2031. Payment of GIE is an incentive in lieu of all national and local taxes, CILA said.

CILA, a group of investors and businesses, said the IRR and BIR issuances “effectively stopped” the enjoyment of the tax incentive and other fiscal perks as some investor firms are now levied with ValueAdded Tax and other forms of taxes.

“The IRR and BIR revenue regulations RR-21-2021, RMC 24-2022 went beyond and against the provision of the Create Act insofar as the transitory provision in Section 311 of Chapter VI is concerned,” the resolution stated.

Moreover, the resolution claimed that the IRR and assailed BIR issuances have “caused massive “confusion as well as substantive impairment to the cost structure, business models and the viability of existing and potential investors.”

Officials of the said business groups have lamented that business climate here and other economic zones has deteriorated and may lead the Philippines’ further lag in the share of Foreign Direct Investments in the Asean region, CILA noted in its statement.