Despite the tax exemption, POGOs continue to decline in the Philippines as a result of the uncertainty in the online gambling industry. The number of Philippine Offshore Gaming Operators (POGO) is smaller, according to the list released by the Philippine Amusement and Gaming Corporation (PAGCOR) this week.
The update shows 51 authorized operators, two fewer than the list of POGOs published in december. These rooms cater to players residing in other countries in Asia and the Pacific. The operators Easy Access Ltd and Pride Fortune Ltd. do not appear on the new list.
The Philippine regulator also updated this week the list of POGOs that were authorized to resume operations, after the closure decreed by the government last march due to the coronavirus pandemic. The updated list includes 34 companies, one less than in the previous list published a month ago.
The name AG Interpacific Resources Ltd. AG Interpacific was added to the current list. This operator that manages the W66.com site, among others, was one of the 61 licensees initially authorized by PAGCOR.
For the resumption of operations of POGO, the regulator PAGCOR put as a condition the payment of all outstanding debts and the guarantee issued by the Immigration Office guaranteeing that the Chinese personnel of the gambling halls had a valid work visa.
Challenge of the 5% tax
However, many POGOs had to reconsider their situation. With the pandemic spreading as before and the imposition of stricter regulations, some preferred not to open again.
In addition, the 5% tax that the Philippine government imposed on online gambling turnover and not on revenue, was not well received by the POGOs.
A POGO group decided to challenge the legality of the tax considering that it subtracts all the profit from the business.
Last week, the Supreme Court then issued a temporary restraining order preventing the government from enforcing it for now.
Following the temporary ruling, the POGOs hope that the government will consider other avenues to obtain additional resources. Instead of squeezing even more from the gambling operators.
The closure of the POGOs left some 277,000 square meters of office space unoccupied last year. Some areas of Metro Manila were left deserted without economic activity, further aggravating the employment crisis.
Kidnappings in the POGOs doubled
As POGOs have closed and operator inactivity has grown in the past year, the number of kidnappings in that sector doubled. The Anti-Kidnapping Group of the Philippine National Police (PNP-AKG) revealed that POGO-related kidnappings rose to 17 in 2020, in contrast to nine recorded the previous year.
In 2020, there were 10 formal POGO kidnapping cases that led to the rescue of 23 people. During the police operations, 33 suspects were arrested and two other people were killed.
Almost all the kidnappers and victims were of Chinese origin, as usual. While the cases of kidnapping related to gambling halls on land fell to 14 last year, 24 less than in 2019.
This year the situation does not seem to be different. Local media said police arrested eight members of a gang of kidnappers last week that was engaged in extorting POGO workers and their families.
All the people arrested are Chinese citizens, except for a local cohort. The criminals were arrested on charges of kidnapping two Chinese POGO workers on Christmas Eve. One of them died when confronting law enforcement officers.
PNP-AKG Brigadier General Jonnel Estomo told the Philippine news agency that the shutdowns caused by the pandemic left the POGOs without income. “Employers have no earnings and to survive they will arrest employees and… ask for money in exchange for freedom for their families abroad.”
This was revealed that the PNP-AKG, in coordination with PAGCOR, is advancing an action plan to continue facing the crime of kidnapping.